Which of the Following Is a True Statement

question 151

Multiple Choice

Which of the following is a true statement?

• A) Externalities cannot be solved by market solutions and always require government action.
• B) Externalities would never be a problem if people were willing to comply with government regulations.
• C) Voluntary agreements can solve externality situations by making the party incurring the costs bear the costs of his or her actions.
• D) Externalities can only be handled by government regulation and emission taxes cannot work effectively.

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Definitions:

Formal Rationality

A decision-making process focused on efficiency, predictability, calculability, and dehumanization, often associated with bureaucratic organizations.

Industrial Era

A period in history characterized by significant technological advancements and the rise of industrial production from the late 18th to the early 20th century.

Bureaucracy

An organizational structure characterized by hierarchical authority, rigid division of labor, written rules, and impersonal relationships, primarily in governmental and large institutional settings.

Rational-legal Authority

A form of leadership in which authority is largely tied to legal rationality, legal legitimacy, and bureaucracy.