An External Benefit Is a Benefit from an Activity That

question 33

True/False

An external benefit is a benefit from an activity that falls on a third party which is not involved in the activity.

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Definitions:

Medical Lawsuits

Legal claims brought against healthcare providers or institutions, typically for malpractice or failure to provide adequate care.

Tobacco Company

A company that produces and sells tobacco products, such as cigarettes, cigars, and pipe tobacco.

Utility-Maximizing

The principle that consumers will allocate their income in a way that maximizes their overall satisfaction or utility.

Investment Portfolio

An assortment of financial assets such as equities, bonds, raw materials, as well as liquid assets including mutual funds and exchange-traded funds (ETFs).