Which of the Following Is a Benefit of Internalizing a Negative

question 131

Multiple Choice

Which of the following is a benefit of internalizing a negative externality?

• A) All pollution is eliminated.
• B) More output is produced.
• C) External costs are taken into account in the market.
• D) The good is sold for a lower price.
• E) Output increases and prices are lower.

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Definitions:

Stock Price

Stock price is the current market price at which a share of stock can be bought or sold, reflecting the value that the market assigns to a company.

Required Return

The minimum return that investors expect to earn on their investment to compensate for its risk.

Dividend Yield

A financial proportion demonstrating how a company's annual dividend payout stands in comparison to its stock price.

Stock Price

The cost of purchasing a share of a company, which fluctuates based on demand and supply in the market.