Consider Two Goods-One That Generates External Benefits and Another That

question 117

Multiple Choice

Consider two goods-one that generates external benefits and another that generates external costs. A competitive market economy would tend to produce:

• A)​too much of both goods, relative to the social optimum.
• B)​too little of both goods, relative to the social optimum.
• C)​too much of the good that generates external benefits relative to the social optimum, and too little of the good that generates external costs.
• D)​too little of the good that generates external benefits relative to the social optimum, and too much of the good that generates external costs.

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Definitions:

Processor

The central unit within a computer that performs the calculation, execution, and processing of data.

RAM

Short for Random Access Memory, it's a form of computer memory that can be read and changed in any order, typically used to store working data and machine code.

Hardware

The physical components of a computer system, including the CPU, memory, and input/output devices.

Input Device

Hardware used to enter data and commands into a computer system; examples include keyboards, mice, and scanners.