Consider Two Goods--One That Generates External Benefits and Another That

question 50

Multiple Choice

Consider two goods--one that generates external benefits and another that generates external costs. A competitive market economy would tend to produce too

• A) much of both goods.
• B) little of both goods.
• C) much of the good that generates external benefits and too little of the good that generates external cost.
• D) little of the good that generates external benefits and too much of the good that generates the external cost.

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Definitions:

Garden Tub

A large, free-standing bathtub, often oval or round, that provides space for relaxation and soaking.

Water Jets

High-pressure water pumps used for cutting a variety of materials, including metals and stones, through a precise and controlled erosion process.

Caulk

A waterproof filling and sealing material used in building works and repairs to prevent water penetration in gaps or joints.

Pet Flea Collars

Devices worn around the necks of pets, such as dogs and cats, designed to repel or kill fleas.