In a competitive market, a negative externality creates a deadweight loss because

A) the cost of the externality is double counted.
B) a harm is generated.
C) price equals social marginal cost.
D) price equals private marginal cost.


D

Economics

You might also like to view...

The costs of unemployment are lowest (and perhaps even negative) for ________ unemployment.

A. cyclical B. frictional C. cyclical and structural D. structural

Economics

In the long run, the level of output depends on the price level

Indicate whether the statement is true or false

Economics

Adding wages, interest, rent, and profits yields

A) net domestic product at factor cost. B) gross domestic product at factor cost. C) total expenditure. D) GNP. E) gross domestic product.

Economics

Grocery stores often replace

A) low profit margin goods with services. B) low profit margin goods with high profit margin goods. C) high profit margin goods with low profit margin goods. D) goods with one type of elasticity with goods of similar elasticities.

Economics