When the Entire Costs and Benefits of a Transaction Are

question 49

Multiple Choice

When the entire costs and benefits of a transaction are borne by the participants of that transaction:

• A)the market outcome will be inefficient.
• B)then private costs and social costs are identical.
• C)an external cost is imposed on the society.
• D)an external benefit is generated in the society.

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Definitions:

Strong Correlation

A statistical measure that indicates a high degree of linear relationship between two variables, showing that when one variable changes, the other has a predictable change too.

Negative Association

A negative association occurs when two variables move in opposite directions, meaning that as one variable increases, the other decreases.

Malaria

A disease caused by a parasite transmitted to humans through the bite of infected mosquitoes.

Dewpoint

The temperature at which air becomes saturated with moisture and dew can form.