If a Good Has an External Cost,the

question 104

Multiple Choice

If a good has an external cost,the

• A) unregulated competitive market outcome is efficient.
• B) marginal private cost reflects the external cost.
• C) unregulated competitive market outcome is inefficient.
• D) marginal social benefit is equal to the marginal social cost when the market is in equilibrium.
• E) external benefit must equal the external cost.

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Definitions:

Seatbelt

A safety device fitted in vehicles, designed to secure the occupant against harmful movement that may result from sudden stops or impacts.

Skinner Box

Is a controlled environment used to observe and study the behavior of animals, especially in experiments involving operant conditioning.

Variable Ratio Schedule

A reinforcement schedule in operant conditioning where rewards are provided after an unpredictable number of responses, promoting high and steady rates of behavior.

Positive Reinforcement

A technique in behavior modification that involves providing a reward following a desired behavior to increase the likelihood of its recurrence.