An externality is defined as
a. an opportunity cost that is not considered, which causes inefficiency.
b. a social cost that affects parties external to a transaction.
c. a transaction which imposes a loss on one of the parties involved.
d. a "cost of doing business" that cannot be allocated to any particular good.
e. the increase in cost associated with increased production.
b
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The goods and services that count toward GDP are:
A. defined in terms of the location of production, not the citizenship of the producer. B. anything produced by a nation’s citizens, regardless of who owns it. C. citizens producing things no matter where they produce it. D. things like stocks and bonds issued by a corporation.
If consuming more of a good doesn't affect a consumer's well-being, then:
A. the marginal utility of the good is positive. B. the marginal utility the good is negative. C. the marginal utility the good is constant. D. the marginal utility the good is zero.