When a Positive Externality Generated from the Production of a Good

question 101

Multiple Choice

When a positive externality generated from the production of a good has not been internalized,then:

• A)the socially optimal quantity of output must be larger than the market level of output.
• B)the socially optimal quantity of output must be less than the market level of output.
• C)the socially optimal quantity of output must be equal to the market level of output.
• D)the socially optimal quantity of output can be either larger or smaller than the market level of output.

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Definitions:

Seasonal Effects

The variations in natural or social phenomena that occur at specific times of the year due to Earth's changing position relative to the sun.

Isotopes

Variants of a particular chemical element that have the same number of protons but different numbers of neutrons.

Evaporation

The process by which water changes from a liquid to a gas or vapor, a key part of the Earth's water cycle and energy balance.

Precipitation

Any form of water, liquid or solid, that falls from the atmosphere and reaches the ground, including rain, snow, sleet, and hail.