When Externalities Exist, Buyers and Sellers

question 49

Multiple Choice

When externalities exist, buyers and sellers

• A)neglect the external effects of their actions, but the market equilibrium is still efficient.
• B)do not neglect the external effects of their actions, and the market equilibrium is efficient.
• C)neglect the external effects of their actions, and the market equilibrium is not efficient.
• D)do not neglect the external effects of their actions, and the market equilibrium is not efficient.

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Definitions:

Individual Attributes

Personal characteristics or qualities that define an individual, including traits, skills, and preferences.

Decision-Making

The process of making choices by identifying a decision, gathering information, and assessing alternative resolutions.

Evolutionary Theorists

Scholars and scientists who study and develop theories regarding the evolutionary processes that have led to the diversity of life on Earth.

Base Rates

The prevalence or general frequency of a characteristic or behavior within a broader population.