Which of the Following Would Be Classified as an External

question 4

Multiple Choice

Which of the following would be classified as an external cost?

• A) As more firms began hiring computer programmers, the salaries of computer programmers increased and therefore the firm's cost of production increased.
• B) You eat too much pizza and end up with a stomach ache.
• C) You are not able to study at night because there is so much noise coming from the dorm room next to yours.
• D) When you purchase a prescription drug you are not made fully aware of all the possible side effects that may result from taking the drug.

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Definitions:

Balanced Scorecard

A strategic planning and management system that organizations use to communicate what they are trying to accomplish, align day-to-day work with strategy, and monitor performance against strategic goals.

Not-for-profit

Organizations that operate without the primary goal of financial profit, often focusing on social, educational, or humanitarian objectives.

All Sectors

Refers to every part of an economy, including primary (agriculture), secondary (manufacturing), and tertiary (services) sectors.

Competitors' Costs

The expenses that competitor companies incur in the production and marketing of their goods or services.