When a Negative Externality Exists, the Private Market Produces

question 255

Multiple Choice

When a negative externality exists, the private market produces

• A)more than the economically efficient output level.
• B)less than the economically efficient output level.
• C)products at a low opportunity cost.
• D)products at a high opportunity cost.

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Definitions:

Enabling Legislation

A statute enacted by a legislature that authorizes the creation of an administrative agency and specifies the name, purpose, composition, and powers of the agency being created.

Administrative Agency

A federal or state government agency established to perform a specific function. Administrative agencies are authorized by legislative acts to make and enforce rules relating to the purpose for which they were established.

Tenth Amendment

The Tenth Amendment to the United States Constitution reserves all powers not delegated to the federal government to the states or to the people.

International Law

International law comprises the rules and agreements that govern the relations between countries, including treaties, conventions, and customary laws.