If a Good Is Produced by Firms That Incur All

question 150

Multiple Choice

If a good is produced by firms that incur all private and external costs, the price consumers pay

• A) will be efficient since it includes all social costs.
• B) will be too low.
• C) will be too high because the consumers end up paying all of the costs instead of the firm.
• D) will be the correct price, but inefficient.

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Definitions:

Value Created

The increase in worth that is generated through the operations or activities of a company or organization.

Public Company

A corporation whose shares are publicly traded on a stock exchange, allowing for public ownership and investment.

Disadvantages

Factors or conditions that put someone or something at a competitive drawback or lower efficiency.

Harvest Goal

An entrepreneur's strategic objective to eventually realize a venture's value through a sale, merger, or initial public offering (IPO).