Evidence of external costs in the production of a product is present if
A) the price of the product is higher than it should be.
B) the production cost increases because of an increase in the minimum wage.
C) non-buyers and/or non-producers of the product experience a loss for which they are not compensated.
D) buyers refuse to purchase the product.
E) producers pay all of the costs of producing the good or service.
C
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The quantity of hamburger that households are willing to purchase is predicted to rise if there is:
a. a fall in the price of hot dogs b. a fall in the price of hamburger buns c. a rise in the price of onion rings d. a rise in the price of catsup
The output losses from an adverse inflation shock are ________ and the output losses from a fall in potential output are ________.
A. large; small B. small; large C. permanent; temporary D. temporary; permanent