An Externality Is

question 43

Multiple Choice

An externality is

• A)a cost of a transaction that is borne by a third party
• B)a benefit of a transaction that is enjoyed by a third party
• C)a cost or benefit that arises when market price changes
• D)any cost or benefit of a transaction that is not accounted for in the market price
• E)the external revenue generated by a firm

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Definitions:

Group Decisions

The process of making choices or solving problems as a collective, where the input and perspectives of multiple individuals are considered.

Benefits and Risks

This encompasses the positive outcomes (benefits) and potential negative consequences (risks) associated with a particular action, decision, or strategy.

Resource Acquisition

The process of obtaining resources necessary for the operation of an organization or project.

No Substitute

The assertion that certain elements or aspects cannot be replaced by alternatives without loss of value or function.