Your State Is Considering Enacting a Law Requiring That All

question 93

Multiple Choice

Your state is considering enacting a law requiring that all motorcycle operators and their passengers wear a helmet.Motorcyclists vary in the degree to which they value being able to ride helmet-less and in the extent to which they value the safety provided by a helmet.
The regulation requiring helmets is more likely to enhance efficiency when

• A)motorcycle accidents impose external costs.
• B)motorcycle accidents do not impose external costs.
• C)motorcyclists as a group are more risk averse than average.
• D)motorcyclists as a group are less risk averse than average.

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Definitions:

Lower Production Costs

Lower production costs refer to a reduction in the expenses associated with creating a product or service, which can lead to increased profitability.

Economically Efficient

A situation in which resources are distributed in a manner that maximizes overall societal benefits.

Production Techniques

The methods and processes employed in the manufacturing of goods or provision of services, often aimed at improving efficiency and productivity.

Labor and Capital

The primary factors of production where "labor" refers to workforce efforts and "capital" denotes tools, machinery, and buildings used in production.