If External Diseconomies Exist in an Industry,the

question 16

Multiple Choice

If external diseconomies exist in an industry,the

• A) market price is too high and should be reduced.
• B) industry is producing a public good.
• C) socially optimal output level is below the equilibrium output level.
• D) industry is perfectly competitive.
• E) industry demand curve should be increased and the industry should be subsidized.

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Definitions:

Income

Money received, especially on a regular basis, for work, through investments, or from business activities.

Risk-averse

A preference for certainty over gamble, where an individual prefers to avoid risk even if it means a potentially lower expected return.

Political Science Major

An academic discipline that focuses on the study of government, political processes, and political behavior.

English Major

An academic field of study that focuses on literature, language, and writing in the English language.