In the Case of a Negative Externality

question 34

Multiple Choice

In the case of a negative externality,

• A)marginal external costs are greater than marginal private costs.
• B)marginal external costs are less than marginal private costs.
• C)marginal external benefits are greater than marginal private benefits.
• D)marginal external benefits are equal to marginal private costs.

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Definitions:

Gunpowder

A mixture of saltpeter, sulfur, and charcoal, used in the past as a propellant in firearms and as an explosive.

Invented

The act of creating, designing, or originating something that has never been made before.

Iberian Peninsula

A region in Southwest Europe, occupied by Spain and Portugal, known for its diverse geography, cultures, and historical significance.

Burgher

A member of the middle class in medieval towns, typically involved in commerce or trade, having certain rights and privileges.