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Suppose That an MBA Degree Creates No Externality Because the Benefits

question 377

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Suppose that an MBA degree creates no externality because the benefits of an MBA are internalized by the student in the form of higher wages. If there are no government subsidies for MBAs, then which of the following statements is correct?


Definitions:

Two-Factor Theory

A theory of emotion developed by Schachter and Singer proposing that emotions are determined by both physiological arousal and cognitive labeling of the cause of that arousal.

Spillover Effect

The phenomenon where an event or behavior in one domain or area influences another, often used in economics, psychology, and environmental science.

Cannon-Bard Theory

A theory of emotion that suggests that emotional experiences occur simultaneously with physiological responses, rather than one causing the other.

Cannon-Bard Theory

A theory of emotion that proposes emotions and bodily responses occur simultaneously, rather than one causing the other.

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