Exhibit 15-1 -Suppose That People Value the Continued Presence of Certain Species

question 111

Multiple Choice

Exhibit 15-1
-Suppose that people value the continued presence of certain species of animals in rural areas, but home-building in those areas reduces the populations of the animals. Home-building creates

• A)a positive externality.
• B)a negative externality
• C)a positive internality.
• D)a negative internality.
• E)a free-rider problem.

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Definitions:

Slope

In mathematics, a measurement of the steepness, incline, or grade of a line, typically expressed as a ratio of vertical change to horizontal change.

Value

The importance or utility that something has for an individual or the market price of a good or service.

Horizontal Axis

In graphing, this is the x-axis, which typically represents the independent variable.

Vertical Axis

In a graph or chart, the vertical line or scale along which numerical data is plotted or measured, usually representing quantities.