When Government Provides a Good with an External Benefit,to Attain

question 65

Multiple Choice

When government provides a good with an external benefit,to attain efficiency the price paid by consumers is set equal to the

• A) marginal private benefit at the efficient level of output.
• B) marginal private cost at the efficient level of output.
• C) amount paid by taxpayers.
• D) market-determined price.
• E) marginal external benefit at the efficient level of output.

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Definitions:

Nutrient Absorption

The process by which substances such as vitamins and minerals from food are taken up into the bloodstream from the digestive tract.

Small Intestine

The part of the gastrointestinal tract between the stomach and large intestine, where most of the digestion and absorption of food takes place.

Esophageal Hiatus

Hole in the diaphragm through which the esophagus passes.

Diaphragm

A dome-shaped muscular partition separating the thorax from the abdomen in mammals, playing a major role in breathing by contracting and expanding the lungs.