Suppose External Costs Are Present in a Market Which Results

question 11

Multiple Choice

Suppose external costs are present in a market which results in the actual market price of $24 and market output of 325 units. How does this outcome compare to the efficient, ideal equilibrium?

• A) The efficient outcome would be greater than 325 units.
• B) The efficient outcome would be less than 325 units.
• C) The efficient outcome would also be 325 units.
• D) The efficient price would be less than $24.

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Definitions:

International Businesses

Companies that operate across national borders, engaging in international trade or investment.

Federal Trade Commission

A U.S. government agency responsible for protecting consumers and ensuring a strong, competitive market by enforcing antitrust and consumer protection laws.

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A form of marketing and advertising which uses the internet to deliver promotional marketing messages to consumers.

Data Collection

Data collection involves systematically gathering, measuring, and analyzing information from a variety of sources to gain insights, inform decisions, or support research objectives.