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:

Cyclical Unemployment

The increase in unemployment that occurs during recessions and downturns in the economic cycle, typically resulting from a decreased demand for goods and services.

Structural Unemployment

Unemployment caused by a mismatch between the skills or location of workers and the requirements of the job market.

Frictional Unemployment

Short-term unemployment that occurs when individuals are between jobs or entering the labor market for the first time.

Consumer Price Index

A gauge that assesses the combined average prices of a variety of consumer products and services, encompassing transportation, food, and medical attention.