Which of the Following Supply and Demand Situations Definitely Involves

question 53

Multiple Choice

Which of the following supply and demand situations definitely involves a positive externality?

• A) An S_internal or D_internal curve lies to the right of the corresponding S_social or D_social curve.
• B) An S_internal or D_internal curve lies to the left of the corresponding S_social or D_social curve.
• C) An S_internal curve lies to the left or right of the corresponding S_social curve.
• D) A D_internal curve lies to the left or right of the corresponding D_social curve.
• E) The externality has not been internalized through government intervention.

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Definitions:

Partnership Net Income

The total profits earned by a partnership that are to be divided among partners in agreed-upon proportions.

Equity

The amount of funds contributed by owners (shareholders) plus the retained earnings (or losses), representing ownership interest in a firm.

Capital Balances

The amount of money that the partners or owners of a business have contributed or acquired through retained earnings.

Partnership Liabilities

The debts and obligations for which a partnership is legally responsible, typically shared among the partners according to their agreement.