When a Negative Externality Is Present in a Market,when a Quota

question 60

Multiple Choice

When a negative externality is present in a market,when a quota is imposed,it is:

• A)efficient,because the market consumes the efficient level.
• B)not efficient,because individuals' net benefit of the amount set by the quota are different.
• C)efficient,because the net benefit of everyone at the amount set by the quota is equal.
• D)not efficient,because the marginal cost outweighs the marginal benefit for too many consumers at the amount set by the quota.

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Definitions:

Operating Expenses

Ongoing expenses incurred in the normal operations of a business, including rent, utilities, salaries, and marketing costs, but excluding the cost of goods sold.

Sales Budget

A detailed projection of future sales, often broken down by product line, region, or sales channel, that guides business planning.

Quarterly Sales

The total revenue generated from the sale of goods or services within a three-month period.

Sales Price

The amount of money for which a product or service is sold to a customer.