What Do Economists Use the Term Externalities to Refer To

question 72

Multiple Choice

What do economists use the term externalities to refer to?

• A) the shipment of goods and services to foreign nations
• B) the importation of goods and services from foreign nations
• C) benefits or costs of actions that spill over onto third parties
• D) management decisions made outside of one's own department or division

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Definitions:

Budgeted Net Income

The estimated amount of money expected to be earned over a specific period after all expenses are subtracted.

Variable Costs

Costs that change in proportion to the level of production or business activity.

Fixed Costs

Expenses that do not vary with the volume of output, including costs like rent, salaries, and insurance premiums.

Net Income

The total earnings of a company after subtracting all expenses, taxes, and costs, indicating its profitability.