Figure 5-1 Figure 5-1 Shows a Market with an Externality. the Current

question 246

Multiple Choice

Figure 5-1

Figure 5-1 shows a market with an externality. The current market equilibrium output of Q₁ is not the economically efficient output. The economically efficient output is Q₂.
-Refer to Figure 5-1.Suppose the current market equilibrium output of Q₁ is not the economically efficient output because of an externality.The economically efficient output is Q₂.In that case, the diagram shows

• A)the effect of a positive externality in the production of a good.
• B)the effect of a negative externality in the production of a good.
• C)the effect of an external cost imposed on a producer.
• D)the effect of an external benefit such as a subsidy granted to consumers of a good.

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Definitions:

Negative Symptoms

Features associated with reductions or deficits in normal emotional and behavioral functions, often seen in schizophrenia, such as apathy and lack of speech.

Social Withdrawal

The act of removing oneself from social interactions and activities, often as a response to anxiety, depression, or other stressors.

Antisocial Personality Disorder

A mental disorder characterized by a long-term pattern of disregard for, and violation of, the rights of others.

Lacks Empathy

Describes an individual's difficulty or inability to understand and share the feelings of another person.