Which of the Following Would Be an External Cost Associated

question 20

Multiple Choice

Which of the following would be an external cost associated with the manufacture of cigarettes?

• A) Price of a pack of cigarettes.
• B) Price of leaf tobacco.
• C) Cost to the government of the hospital expenses of indigent smokers.
• D) Cost to the employer of the higher health insurance premiums due to the hiring of a smoker.
• E) Cost to the employer of the extra effort lost due to the increased missed days of work as a result of smoking.

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Definitions:

Average Returns

The mean financial return of an investment over a given time period, calculated by summing the returns of each period and dividing by the number of periods.

Confidence Index

A measure indicating the level of confidence investors have in the stock market, often based on bond yield comparisons.

Corporate Bonds

Debt securities issued by corporations to finance their operations, projects, or expansion plans.

Intermediate-grade Bonds

Bonds rated in the medium quality range by rating services, indicating moderate risk, situating them between high-grade and high-yield or junk bonds.