A Positive Externality Results When

question 155

Multiple Choice

A positive externality results when

• A) economists are sure that a good or service provides benefits to consumers.
• B) someone pays for a good or service even though she is not directly affected by the production or consumption of it.
• C) when people who live in one country benefit from the production of a good or service that occurs in another country.
• D) people who are not directly involved in producing or paying for a good or service benefit from it.

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Definitions:

Bargaining Power

The relative capacity of parties in a negotiation to exert influence on each other, often influencing the terms and conditions of agreements.

Single Buyer

A market situation where there is only one buyer, or consumer, for a particular product or service, often leading to monopsony power.

Single Seller

A market structure where there is only one provider of a particular product or service, leading to monopoly.

Federal Judicial Power

The authority granted to federal courts and judges to rule on legal disputes, including interpreting the Constitution and laws of the United States.