Consider Two Goods--One That Generates External Costs and Another That

question 98

Multiple Choice

Consider two goods--one that generates external costs and another that generates external benefits. The actual market outcome would

• A) result in output that is lower than the efficient output for both goods.
• B) result in output that is higher than the efficient output for both goods.
• C) result in output that is lower than the efficient output for the good with an external benefit and output that is higher than the efficient output for the good with an external cost.
• D) result in output that is higher than the efficient output for the good with an external benefit and output that is lower than the efficient output for the good with an external cost.

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Definitions:

Mass Marketing

A marketing strategy that targets a large audience with a general message, aiming to reach as many people as possible through broad communication channels.

Commodity Goods

Basic goods used in commerce that are interchangeable with other goods of the same type, often used in economic analysis and trading.

Target Marketing

The process of identifying and communicating with specific segments of the market that are considered more likely to buy a particular product or service.

Mass Production

A manufacturing method that produces large quantities of standardized products, often on assembly lines, enabling economies of scale and cost reduction.