When Consuming a Good Creates Positive Externalities

question 38

Multiple Choice

When consuming a good creates positive externalities,

• A)private demand increases
• B)private demand decreases
• C)the private demand curve overstates the marginal social benefit of the good
• D)the private demand curve understates the marginal social benefit of the good
• E)the equilibrium quantity increases without government intervention

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Definitions:

Operant Conditioning

A learning process through which behavior is shaped by reinforcement or punishment.

Latent Learning

A type of learning that occurs without any obvious reinforcement of the behavior or associations that are learned.

Learning/Performance Distinction

Referring to the observation that learning can take place without actual performance of the learned behavior.

Innate Performance Preference

A natural tendency or predisposition to favor certain behaviors or skills without prior learning or experience.