When a Negative Externality Is Internalized,efficiency Increases by Shifting The

question 132

Multiple Choice

When a negative externality is internalized,efficiency increases by shifting the:

• A)external cost from those not involved in the market to those involved.
• B)external cost from those involved in the market to those not involved.
• C)private cost from those not involved in the market to those involved.
• D)social cost from those not involved in the market to those involved.

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Definitions:

Variable Cost

Costs that vary directly with the level of production or output, increasing as production increases and decreasing as production decreases.

Net Operating Income

A company's total pre-tax profit, derived from its normal business operations, excluding non-operating income and expenses.

Special Order

Special Order refers to a one-time or unique request by a customer for a product or service that may differ from the standard offerings of a company.

Net Operating Income

A measure of a company's profitability from its core business operations, excluding expenses and revenues from investments and financing.