Negative Externalities Are Created When

question 57

Multiple Choice

Negative externalities are created when

• A) an increase in the price of butterfat drives up the price of ice cream.
• B) a driver leaves his car in a parking space after the meter expires and receives a ticket.
• C) a driver drives recklessly on a busy highway.
• D) a driver pulls over to help a stranded motorist fix a flat tire.

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Definitions:

Financing Activities

Transactions involving long-term liabilities, stockholders' equity, and changes in short-term loans that affect a company's cash flow.

Note Payable

A written agreement to pay a specific sum of money, usually including interest, at a future date.

Statement of Cash Flows

A financial report that provides aggregate data regarding all cash inflows and outflows a company receives.

Exchange

A marketplace where securities, commodities, derivatives, and other financial instruments are traded between buyers and sellers.