Why do externalities arise?
a. The costs of production are not borne by the producer.
b. An economic activity imposes a burden on those who are not directly involved in it.
c. The consumption of a public good is nonexcludable.
d. The government produces goods and services which are consumed by only a particular group of people.
e. Goods of mass consumption are not produced as they do not yield profit for the producers.
b
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Output in the long run is determined by which of the two following factors when an economy operates at full employment?
A) capital and supply B) capital and labor C) the "real" GDP and purchases D) imports and exports
Refer to Table 3-2. The table above shows the demand schedules for cashews of two individuals (Jordy and Amy) and the rest of the market. At a price of $6, the quantity demanded in the market would be
A) 87 lbs. B) 95 lbs. C) 103 lbs D) 215 lbs.
Define the tragedy of the commons. Give three examples of common resources. Briefly explain why common property resources are subject to overuse
What will be an ideal response?
Which of the following is a public good?
a. Air traffic control. b. National defense. c. Clean air. d. All of these.