Assume That the Production of a Good Imposes External Costs

question 112

Multiple Choice

Assume that the production of a good imposes external costs upon third parties. If the price and quantity of this good is set by supply and demand the price will be too:

• A) high and quantity too low for efficient resource allocation.
• B) low and quantity too low for efficient resource allocation.
• C) low and quantity too high for efficient resource allocation.
• D) high and quantity too high for efficient resource allocation.

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Definitions:

Private Label Brand

A product manufactured by one company for sale under another company's brand, typically a retailer's brand, to offer exclusive products.

Store's Brand Name

The unique name given to a product line or brand that is owned and sold by a particular retail store, differing from manufacturer brands.

Market Pantry

A brand of consumer food and household products sold exclusively at Target Corporation stores.

Valuable Global Brand

A brand with high financial value and strong brand equity that is recognized and respected across the world.