If a Market Is Subject to a Positive Externality

question 76

Multiple Choice

If a market is subject to a positive externality,

• A) the demand curve reflecting social benefit will be to the right of the demand curve representing private benefit.
• B) there is only one demand curve.
• C) the demand curve reflecting social benefit will be to the left of the demand curve representing private benefit.
• D) private benefit will exceed social benefit.

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Definitions:

Pythagorean Theorem

A fundamental relation in Euclidean geometry among the three sides of a right triangle that states that the square of the length of the hypotenuse is equal to the sum of the squares of the lengths of the other two sides.

Algorithm

A systematic procedure for solving a problem that works invariably when it is correctly applied.

Prototypes

The best or most typical example of a particular category or concept, often used as a basis for understanding or judgment.

Systematic Random Search Algorithm

An algorithmic approach that combines elements of randomness with a systematic strategy to solve optimization problems.