If the Social Benefit of Consuming a Good or a Service

question 31

Multiple Choice

If the social benefit of consuming a good or a service exceeds the private benefit

• A) a negative externality exists.
• B) the market achieves economic efficiency.
• C) a positive externality exists.
• D) the sum of consumer surplus and producer surplus is maximized.

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Definitions:

Check

A documented, signed, and dated directive that instructs a bank to pay a predetermined amount of money to the bearer or a specified individual.

Indorsement

A rephrased definition: The act of signing one's name on the back of a negotiable instrument, effectively transferring rights to another party.

Negotiable Instrument

A written document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the ability to be transferred to another party.

Significant Effects

Impacts or changes that are considerable in size, importance, or consequence in a specific context or situation.