Which of the following would result in a positive externality? Group of answer choices A)A power plant in a city neighborhood causes fumes that create respiratory problems. B)A company does research on DNA that supports vaccine development. C)A restaurant provides calorie data on its menu. D)A city introduces a rental price control.

Which of the following would result in a positive externality? Group of answer choices A)A power plant in a city neighborhood causes fumes that create respiratory problems. B)A company does research on DNA that supports vaccine development. C)A restaurant provides calorie data on its menu. D)A city introduces a rental price control.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter8: Market Failure

Section: Chapter Questions

Problem 1P

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What is the main problem associated with negative externalities? a) They lead to an overallocation of resources. b) They result in inefficiency in resource allocation. c) They encourage competitive markets. d) They have no impact on market outcomes.
Which of the following would create a negative externality? A person plays loud music that can be heard by neighbors who would like to sleep O People do not consider the risk of spreading a virus when making decisions O A power plant does not pay the cost of acid rain from burning coal all of these
why do externalities make market outcomes inefficient?
Explain the difference between positive and negative externalities along with an example.
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A positive externality arises when a third party, outside the market transaction, fails to allocate resources efficiently Pays less for the good or service benefits from a market transaction pays a pollution tax to balance social costs
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