If Production of an Item Results in Negative External Costs

question 160

Multiple Choice

If production of an item results in negative external costs, then

• A) the market price is below the socially preferred price that reflects the external costs.
• B) the market price is above the socially preferred price that reflects the external costs.
• C) market forces will always correct the problem.
• D) the market quantity is too low from society's point of view.

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Definitions:

Psychological Fatigue

A state of mental exhaustion caused by prolonged stress, overwork, or intense cognitive activity, leading to decreased performance and motivation.

Long-term Solution

A solution designed to effectively address a problem or challenge over an extended period, focusing on sustainability and permanence.

Clarifying Values

The process of identifying and understanding one's personal values and beliefs to guide behavior and decision-making.

Reducing Workload

The process of decreasing the amount of work assigned to an individual or team, often aimed at improving balance and reducing stress.