An Externality Is

question 28

Multiple Choice

An externality is:

• A) always a benefit to the recipient.
• B) always a detriment to the recipient.
• C) an activity that occurs in a business which is unknown to management.
• D) an unintended benefit or cost imposed on third parties as a result of economic activity.

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Definitions:

Standard Deviation

A measure of the amount of variation or dispersion of a set of values.

Reliability

Refers to the consistency and stability of a measure or test over time.

Validity

The extent to which a test, scale, or measuring instrument accurately measures what it is intended to measure.

Predictive Validity

The extent to which a score on a scale or test predicts future performance on a related measure.