When a Firm Generates External Benefits, a More Efficient Outcome

question 93

Multiple Choice

When a firm generates external benefits, a more efficient outcome would result if

• A) the firm produced a larger output level.
• B) the firm reduced its output level.
• C) a tax were levied on the firm equal to the dollar amount of the externalities.
• D) price were fixed below the firm's per-unit cost.

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Definitions:

Nuclear War

A conflict in which countries use nuclear weapons against each other, potentially causing massive destruction and loss of life.

Soviet Invasion

Refers to various military incursions led by the Soviet Union into other nations, notably Hungary in 1956 and Czechoslovakia in 1968, to maintain political control.

The Lonely Crowd

A sociological analysis published in 1950 by David Riesman, Nathan Glazer, and Reuel Denney, discussing changes in American character and social structure.

David Riesman

A sociologist known for his work on the Sociology of knowledge, personality, and his book "The Lonely Crowd," which analyzes American character.