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An External Cost Is Built into the Market Price of a Good

question 101

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An external cost is built into the market price of a good and thus paid by the consumers.


Definitions:

Annual Premium

The total cost paid per year for an insurance policy to remain in effect.

Deductible

The amount an insured individual must pay out-of-pocket before an insurance company pays a claim.

Accident Reconstructionist

Person with knowledge of both crime scene investigations and the mathematics that can help to explain the circumstances surrounding the accident.

Skid Marks

Visible marks left on the road surface by tires that have slipped or skidded, often analyzed in accident reconstructions.

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