When a Negative Externality Is Internalized in a Market,total Surplus

question 137

Multiple Choice

When a negative externality is internalized in a market,total surplus:

• A)increases,but producer and consumer surplus both fall.
• B)decreases,because producer and consumer surplus both fall.
• C)increases,because producer surplus increases.
• D)decreases,because consumer surplus falls more than producer surplus increases.

---

Definitions:

Hidden Prejudice

Prejudicial attitudes or biases that are not overtly expressed or are consciously recognized by individuals.

Stereotype

Widely shared and simplified evaluative image of a social group and its members.

Schema

Cognitive structure that represents knowledge about a concept or type of stimulus, including its attributes and the relations among those attributes.

Prototype

An original model or first version of a product or concept from which later versions are developed or copied.