When External Benefits Are Present in a Market

question 15

Multiple Choice

When external benefits are present in a market,

• A) less of the good will be produced than the amount consistent with economic efficiency.
• B) more of the good will be produced than the amount consistent with economic efficiency.
• C) the amount of the good produced will be equal to the amount consistent with economic efficiency.
• D) corresponding external costs are always generated.

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Definitions:

Institutional Review Board

A committee that reviews and approves research protocols to ensure ethical standards are maintained in studies involving human participants.

Placebos

Inactive substances or treatments used as a control in experiments to test the effectiveness of medical interventions.

Peer Review

The evaluation of work by one or more people of similar competence to the producers of the work, commonly used in academic settings.

Exacerbation Study

Research focused on understanding the processes or factors that worsen symptoms or the condition of a disease over time.