Unintended Costs That Are Imposed on Third Parties as a Result

question 120

Multiple Choice

Unintended costs that are imposed on third parties as a result of an economic activity are called:

• A)marginal costs.
• B)direct costs.
• C)negative externalities.
• D)positive externalities.
• E)positive costs.

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Definitions:

20-year Annuity

A financial product that provides a stream of payments to the holder for a period of 20 years.

Future Value

The value of a current asset at a specified date in the future based on an assumed rate of growth or interest.

Ordinary General Annuity

An annuity in which the payment interval does not equal the compounding interval, and payments are made at the end of each payment interval.

Semi-annual Payments

Payments made twice a year, often in the context of loans, investments, or insurance premiums.