In a Market with an External Cost,government Action

question 78

Multiple Choice

In a market with an external cost,government action

• A) cannot decrease the amount of the deadweight loss from the external cost.
• B) can sometimes help to achieve an efficient outcome.
• C) cannot alter firms' cost curves.
• D) Both answers A and C are correct.
• E) Both answers B and C are correct.

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Definitions:

Positive Nominations

A method used in research, particularly within the context of developmental psychology, where participants identify peers who exhibit positive qualities or behaviors.

Money Market Fund

A type of mutual fund designed to offer investors high liquidity with a very low level of risk by investing in short-term, high-quality financial instruments.

Mutual Fund

An investment company that pools individual investor dollars and invests them in large numbers of well-diversified securities.