When the Consumption of a Good Generates Positive Externalities,_____

question 65

Multiple Choice

When the consumption of a good generates positive externalities,_____

• A)the private demand curve for the good shifts rightward.
• B)the private demand curve for the good shifts leftward.
• C)the private demand curve for the good lies below the marginal social benefit curve.
• D)the private demand curve for the good lies above the marginal social benefit curve.
• E)the equilibrium quantity of the good determined by the free private market is too high.

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Definitions:

Functional Currency

The currency that most influences sales prices, labor, and material costs, and is often the currency in which most of the business transactions are denominated.

Translation Rate

The exchange rate used to convert the financial statements of a foreign subsidiary to the reporting currency of the parent company.

Functional Currency

The primary currency of the primary economic environment in which an entity operates, used in preparing its financial statements.

Dividends

Distributions by a company to its shareholders, consisting of a share of the company's profits.