When External Costs Exist the Market Outcome Will Generally Be

question 34

True/False

When external costs exist the market outcome will generally be inefficient.

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Definitions:

Schachter's Two-factor Theory

A theory proposing that emotional experiences arise from physiological arousal followed by a cognitive interpretation of that arousal, where the context influences the type of emotion felt.

Arousal

A physiological and psychological state of being awake or reactive to stimuli, often linked to motivation and performance levels.

Emotion

A complex psychological state involving an individual's subjective experience, physiological response, and behavioral or expressive response to stimuli.

Self-regulation

The ability of an individual to manage and control their thoughts, emotions, and behaviors in accordance with long-term goals.