Externalities Occur When the Actions of One Individual Affect Another

question 17

True/False

Externalities occur when the actions of one individual affect another individual's well-being,and the relevant costs are reflected in market prices.

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Definitions:

Legitimate Power

Authority that is officially granted to a leader or manager by an organization, recognized as rightful by those who are governed by it.

Authority

The power or right to give orders, make decisions, and enforce obedience.

Order

The arrangement or organization of people, tasks, or things following a particular sequence, pattern, or method.

Coercive Power

This refers to the ability of a person to force others to comply with orders or requests through threats, punishment, or negative consequences.