A Shift from S₁ to S₂ Reflects the Change That $P _ { 1 }$

question 61

Multiple Choice

A shift from S₁ to S₂ reflects the change that happens when a negative externality is taken into account.A shift from D₁ to D₂ reflects the change that happens when a positive externality is taken into account.
-Refer to the above figures.A negative externality exists that has not been corrected.Price and quantity will be

• A) \(P _ { 1 }\) and \(\mathrm { Q } _ { 1 }\) .
• B) \(P _ { 2 }\) and \(\mathrm { Q } _ { 2 }\) .
• C) \(\mathrm { P } _ { 3 }\) and \(\mathrm { Q } _ { 3 }\) .
• D) \(\mathrm { P } _ { 4 }\) and \(\mathrm { Q } _ { 4 }\) .

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Definitions:

Actual Price

The real price at which a transaction takes place, unaffected by any discounts or premiums.

Variable Budget

A budget that adjusts spending levels based on changes in actual revenue or other financial indicators.

Variable Costs

Expenses that change in proportion to the activity of a business, such as costs for raw materials or production supplies.

Variance Account Balances

The difference between budgeted and actual figures in accounting, requiring analysis to manage and adjust financial performance.