If a Product Has Zero External Costs,then

question 293

Multiple Choice

If a product has zero external costs,then

• A) marginal social cost equals marginal private cost.
• B) marginal social cost is greater than marginal private cost.
• C) marginal social cost is less than marginal private cost.
• D) marginal social cost equals zero.
• E) We need more information to determine the relationship between marginal private cost and marginal social cost.

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Definitions:

Condition Subsequent

A condition in a contract that, when fulfilled, can terminate the contract’s obligations or bring it to an end.

Full Force And Effect

A legal term indicating that all terms of a contract or law are currently active and enforceable.

Financing

The act of providing funds for business activities, making purchases, or investing.

Discharged By Frustration

A contract termination because an unforeseen event makes contractual obligations impossible to perform or drastically changes the party's principal purpose for entering into the contract.