Use the following statements to answer this question: I. Stock externalities depend on the accumulated results of actions by producers or consumers, not on the incremental results that may occur in a given period of time.
II) Stock externalities are always negative externalities.
A) I and II are true.
B) I is true and II is false.
C) II is true and I is false.
D) I and II are false.

Question

Quizplus · Accepted Answer

Statement I is true as stock externalities are cumulative and result from the accumulation of actions over a period of time. Statement II is false as stock externalities can be positive or negative, depending on the situation. For example, the existence of public parks and green spaces can be a positive stock externality, while the pollution of a river is a negative stock externality.

Use the Following Statements to Answer This Question: I