An Individual Firm Will Not Normally Have Any Incentive to Internalize

question 137

Multiple Choice

An individual firm will not normally have any Incentive to internalize external costs because to do so would;

• A) make it subject to government regulation.
• B) cause its MC curve to shift to the right.
• C) put it at a competitive disadvantage to rival producers.
• D) not give it much public relations help with the public.

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Definitions:

Retained Earnings

The portion of a company's profits that is kept or retained rather than distributed to shareholders as dividends, typically used for reinvestment.

Accounts Closed

This term refers to the process of clearing the balance of temporary accounts at the end of the accounting period and transferring the balances to permanent accounts.

Trial Balance

A bookkeeping report that lists the balances of all ledgers accounts in order to verify that total debits equal total credits.

Financial Statements

Formal records of an entity's financial activities and conditions, including the balance sheet, income statement, and cash flow statement.