________ is present when the actions of one economic agent affect other economic agents through changes in the prices of goods and services.

Question

Quizplus · Accepted Answer

Pecuniary externalities occur when the actions of one economic agent affect other economic agents through changes in the prices of goods and services. For example, if a firm increases its production and lowers the price of its product, it may cause other firms to lower their prices as well, which can affect the profits of those other firms.

________ Is Present When the Actions of One Economic Agent