Suppose that in most car collisions between cars of unequal size, the smaller car sustains the most damage and its occupants suffer the most injury. In answering the following question, assume that, on average, smaller cars generate less air pollution than larger cars and that every person in the economy drives at least one car. Relative to driving an average car, driving a larger-than-average car generates:
A)an external cost.
B)an external benefit.
C)neither an external benefit nor an external cost.
D)a prisoner's dilemma.

Question

Quizplus · Accepted Answer

A larger-than-average car imposes costs on the owners of smaller cars and on the environment.

Suppose That in Most Car Collisions Between Cars of Unequal