When Externalities Cause Markets to Be Inefficient

question 150

Multiple Choice

When externalities cause markets to be inefficient,

• A)government action is always needed to solve the problem.
• B)private solutions can be developed to solve the problem.
• C)given enough time, externalities can be solved through normal market adjustments.
• D)there is no way to eliminate the problem of externalities in a market.

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Definitions:

Functional Groups

Functional groups are specific groups of atoms within molecules that are responsible for the characteristic chemical reactions of those molecules.

Organic Molecules

Chemical compounds containing carbon atoms bonded together and with other elements, typically forming the basis of life on Earth.

Base

A substance that can accept hydrogen ions (protons) or more generally, donate a pair of valence electrons in reactions.

Brønsted-Lowry

The Brønsted-Lowry theory defines acids as proton (H+) donors and bases as proton acceptors, emphasizing the role of proton transfer in acid-base reactions.