Positive externalityNo externalityNegative externalityAnswer BankThe U.S. government decides toLyle and JuliafromThehing companyicagohouse all of its nuclear wasteto Los Angeles with their newborninfant who cries the entire wayillegally hunts the Coelacanth,material at Cactus Cliff, WY. Asa critically endangered fish that is closeto extinctionwith all nuclear waste, there isno fail-safe protection methodJane raises bees to produce honeyRonald, the first in his family to attendfor her business, but her bees alsocollege, graduates from medical schoolpollinate many flowers in theneighborhood where she lives.and decides to return home to work as adoctor in his old neighborhood.

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Answered: Positive externality No externality…

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter10: Externalities

Section: Chapter Questions

Problem 10PA

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Give an example of a positive externality and an example of a negative externality.
In the Land of Purity, there is only one form of pollution, called gunk. Table 12.14 shows possible combinations of economic output and reduction of gunk, depending on what kinds of environmental regulations you choose. Sketch a graph of a production possibility frontier with environmental quality on the horizontal axis, measured by the percentage reduction of gunk, and with the quantity of economic output on the vertical axis. Which choices display productive efficiency? How can you tell? Which choices show allocative efficiency? How can you tell? In the choice between K and L, can you say which one is better and why? In the choice between K. and N, can you say which one is better, and why? If you had to guess, which choice would you think is move likely to represent a command-and-control environmental policy and which choice is more likely to represent a market-oriented environmental policy, choice L or M? Why?
An increase in globalization has lead to an increase in pollution, and this is a problem because pollution is seen to be the classic example of a This is a that individuals impose on others but do not pay for. O negative externality, cost O possitive externality, benefit O negative externality, benefit O possitive externality, cost
Fish that swim in international waters are a common good that are freely available toanyone who wants to catch them, but this leads to the problem of over-fishing. At theheart of this problem lies an externality. Using appropriate diagrams andaccompanying discussion, show both how and why this over-fishing takes place. Inyour explanation, identify the source of the externality.
Suppose that a mayor of a large city believes strongly that education provides great benefits to the community andurges the state government to provide the district with more money. An economist would say that this reflects theMayor's belief that:Asince teachers are overpaid, the district needs more money to hire enough teachers for its classrooms.Bthere are positive external benefits associated with education.Cthere are nontrivial external costs associated with education.Dpublic schools provide a higher quality education than private schools.
The following graph represents the market for high-emissions cars. Answer this question assuming that the externality is not internalised. Price of high tmissiens velides Sorial Value &, Quantity of high imissions vehidles What is the social cost of the last unit traded in the market? O P1 O P2 O P3 OP4 O OO0
Four roommates are planning to spend the weekendin their dorm room watching old movies, and theyare debating how many to watch. Here is theirwillingness to pay for each film:Dwayne Javier Salman ChrisFirst film $7 $5 $3 $2Second film 6 4 2 1Third film 5 3 1 0Fourth film 4 2 0 0Fifth film 3 1 0 0a. Within the dorm room, is the showing of a moviea public good? Why or why not?b. If it costs $8 to stream a movie, how many moviesshould the roommates stream to maximize totalsurplus?c. If they choose the optimal number from part (b)and then split the cost of streaming the moviesequally, how much surplus does each personobtain from watching the movies?d. Is there any way to split the cost to ensure thateveryone benefits? What practical problems doesthis solution raise?e. Suppose they agree in advance to choose theefficient number and to split the cost of the moviesequally. When Dwayne is asked his willingness topay, will he have an incentive to tell the truth? Ifso, why? If not, what will he…
Aiticle Link: https://bit.lv/3fbNtrFe The following graph represents the market for high-emissions cars. Answer this question assuming that the externality is not internalised. Price of high tmiiees vekides Secial Value Babetty high emistions vehiles What is the private value of the last unit traded (or the willingness to pay of the marginal buyer) in the market? P1 O P2 O P3 P4
WHY SHOULD OTHER PECPLE BENEFIT FROM MY HARD WORK? 1994 Wateron De tyh e d Figure 1 Figure 1 shows how Calvin carefully avoids creating a positive externality (think of this as the equivalent of a factory applying a filter to eliminate any polluting emissions). Assume that this way of snow shovelling does not create any additional costs for Calvin (no extra effort and he has no plans to return home any time soon). b) As creating positive externalities leads to a social problem (see question a), and Calvin's way of snow shovelling avoids creating positive externalities, does Calvin's behaviour imply an efficiency improvement from a social point of view? Explain.
qs abiv 30 ovo pilo 5. Oil spills from oceangoing tankers are rare but bring huge damages to coastlines when they occur within 200 miles of shore. Unfortunately, most tanker spills do occur on or near coasts. Rank the following alternatives according to how efficient they are in i jud, responding to the threat of oil spills. Explain your ranking. a. Each nation with an endangered coastline should impose a tax on all imported oil, a tax that raises enough revenue to compensate for any oil-spill damages. b. Each coastal nation should impose a tax on all domestically purchased oil, a tax that raises enough revenue to compensate for any oil-spill damages. c. Oil-carrying companies should be legally liable for all damages, in the courts of the countries whose national waters are polluted by the spills. d. Each coastal nation should intercept all oil tankers in national waters and charge them a fee that will cover the estimated costs of future oil spills.
Time left 0:53:28 Suppose that cookie producers create a positive externality equal to $2 per dozen. What is the relationship between the equilibrium quantity and the socially optimal quantity of cookies to be produced? tion 10 et rered ed out of Select one: ag stion O a. No relationship exists. O b. The equilibrium quantity is less than the socially optimal quantity. O c. The equilibrium quantity is greater than the socially optimal quantity. O d. They are equal. Next page revious page ser tour on this page KT
The following table describes the productionpossibilities of two cities in the country of Baseballia:Pairs of RedSocks per Workerper HourPairs of WhiteSocks per Workerper HourBoston 3 3Chicago 2 1a. Without trade, what is the price of white socks (interms of red socks) in Boston? What is the price inChicago?b. Which city has an absolute advantage in theproduction of each color sock? Which city has acomparative advantage in the production of eachcolor sock?c. If the cities trade with each other, which color sockwill each export?d. What is the range of prices at which mutuallybeneficial trade can occur?

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