A Business-Stealing Externality Is

question 295

Multiple Choice

A business-stealing externality is

• A)an externality that is likely to be punished under antitrust laws.
• B)the negative externality that occurs when one firm attempts to duplicate exactly the product of a different firm.
• C)an externality that is considered to be an explicit cost of business in monopolistically competitive markets.
• D)the negative externality associated with entry of new firms in a monopolistically competitive market.

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Definitions:

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a given price level, at a specific time.

Black Market

An illegal market where goods or services are traded without compliance with legal requirements, often including the sale of illicit goods.

Illegal Trading

Unlawful transactions of goods or services that may involve insider trading, market manipulation, or trading of illegal items.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, leading to market stability.