The following economic concepts are matched with the scenarios they illustrate:
1. <u>Substitution effect:</u> The rising price of gold causes people to buy silver jewelry instead.
2. <u>Income effect:</u> When the price of chicken increases, families reduce their chicken intake substantially.
3. <u>Positive externality:</u> A new factory in a village provides livelihoods for the villagers.
4. <u>Negative externality:</u> A new factory in a village causes noise pollution.
Income effect causes an individual to adjust his or her consumption of a product due to an increase in its price.
- For example, an increase in the price of chicken causes families to reduce their chicken intake substantially.
In Economics, an externality is either be positive or negative depending on its effect on a third party.
A positive externality arises when the production of a finished product or service has a significant impact (benefits) on a third party that isn't directly involved in the process or transaction.
- For example, a new factory in a village provides livelihoods for the villagers.
A negative externality arises when the production of a finished product or service has a negative effect and impact (cost) on a third party.
- For example, a new factory in a village causes noise pollution.
Read more on negative externality here: brainly.com/question/1362529
Answer:
C) the firm is a natural monopoly
Explanation:
In the case of the natural monopoly it has no competitors and in this the monopoly could earned more profit and also at the same time it reduced the average total cost because the output is rises because the monopoly enjoyed the benefit of having the unique product in which no other competitor is dealing with
So as per the given situation, the option c is correct
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Answer:
D) Service Revenue
Explanation:
An unearned revenue is the revenue which is generated before the services are even given to the client. It can also be called as deferred revenue. Hence the answer to this question can not be Unearned Revenue. The other two options (A & B) are also not applicable here.
Hence, it is clear that the revenue generated but yet not received will be known as the Service Revenue in the income statement.
Good Luck buddy.
