Which of the Following Statements About Externality Is INCORRECT

question 52

Multiple Choice

Which of the following statements about externality is INCORRECT?

• A)Pollution of a chemical plant will create negative externalities to the residents living in the neighborhood.
• B)Trees planted in the backyard of a house could create positive externalities to the pedestrians passing under.
• C)Extra output sold by a firm that lowers the market price creates negative externalities to its rivals.
• D)A single action may confer positive externalities on some people,but negative externalities on others.

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Definitions:

Agriculture Commodities

Products derived from farming and agriculture, such as grains, livestock, and dairy products, which are traded on commodities markets.

Price Inelastic

Describes a situation where the quantity demanded of a good or service is not significantly affected by changes in its price.

Parity Ratio

The ratio used to assess the relative value of two currencies, commodities, or sets of data.

Prices Received

The amounts of money received by producers or sellers for the goods or services they sell, often subject to market conditions and demand.