A Negative Externality

question 183

Multiple Choice

A negative externality:

• A)is any cost above the economic cost.
• B)equals the social cost plus the firm's private cost.
• C)is an uncompensated cost imposed by an individual or firm on others.
• D)equals the opportunity cost minus the social costs.

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Definitions:

Renounces

The act of formally or officially declaring the abandonment or rejection of a right, title, position, or allegiance.

Agency Law

A body of law concerning the relationship where one party (the agent) is authorized to act on behalf of another (the principal) in dealings with third parties.

Instructions

Directions or orders given by one party to another, especially in the context of a legal, business, or contractual relationship.

Revocation

The official cancellation or withdrawal of an offer, right, or privilege, often requiring a formal declaration.