Economics (7th Edition) (What's New in Economics)
7th Edition
ISBN: 9780134738321
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Question
Chapter 5, Problem 5.4.9PA
Sub part (a):
To determine
Whether herd immunity is the public good.
Sub part (b):
To determine
Impact of free riding on immunity.
Sub part (c):
To determine
Why most people vaccinate their children.
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Historically, Vaccinations have prevented the spread of certain diseases such as chicken pox or megningtis. What type of externality takes place with the consumption of such vaccines. Explain with words and a graph.
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Suppose that we have a model that estimates that taking the COVID-19 vaccine creates a positive externality to society that is at least equal to $1500 per vaccine. (Amazing, right? Well, remember that I made it up.) This means that for every person that takes the vaccine, the benefits to society will be $1500 or more.
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Chapter 5 Solutions
Economics (7th Edition) (What's New in Economics)
Ch. 5 - Prob. 5.1.1RQCh. 5 - Prob. 5.1.2RQCh. 5 - Prob. 5.1.3RQCh. 5 - Prob. 5.1.4RQCh. 5 - Prob. 5.1.5RQCh. 5 - Prob. 5.1.6PACh. 5 - Prob. 5.1.7PACh. 5 - Prob. 5.1.8PACh. 5 - Prob. 5.1.9PACh. 5 - In a study at a large state university, students...
Ch. 5 - Prob. 5.1.11PACh. 5 - Prob. 5.1.12PACh. 5 - Prob. 5.1.13PACh. 5 - Prob. 5.2.1RQCh. 5 - Prob. 5.2.2RQCh. 5 - Prob. 5.2.3RQCh. 5 - Prob. 5.2.4PACh. 5 - Prob. 5.2.5PACh. 5 - Prob. 5.2.6PACh. 5 - Prob. 5.2.7PACh. 5 - Prob. 5.2.8PACh. 5 - Prob. 5.2.9PACh. 5 - Prob. 5.2.10PACh. 5 - Prob. 5.2.11PACh. 5 - Prob. 5.3.1RQCh. 5 - Prob. 5.3.2RQCh. 5 - Prob. 5.3.3RQCh. 5 - Prob. 5.3.4PACh. 5 - Prob. 5.3.5PACh. 5 - Prob. 5.3.6PACh. 5 - Prob. 5.3.7PACh. 5 - Prob. 5.3.8PACh. 5 - Prob. 5.3.9PACh. 5 - Prob. 5.3.10PACh. 5 - Prob. 5.3.11PACh. 5 - Prob. 5.3.12PACh. 5 - Prob. 5.3.13PACh. 5 - Prob. 5.3.14PACh. 5 - Prob. 5.3.15PACh. 5 - Prob. 5.3.16PACh. 5 - Prob. 5.4.1RQCh. 5 - Prob. 5.4.2RQCh. 5 - Prob. 5.4.3RQCh. 5 - Prob. 5.4.4PACh. 5 - Prob. 5.4.5PACh. 5 - Prob. 5.4.6PACh. 5 - Prob. 5.4.7PACh. 5 - Prob. 5.4.8PACh. 5 - Prob. 5.4.9PACh. 5 - Prob. 5.4.10PACh. 5 - Prob. 5.4.11PACh. 5 - Prob. 5.4.12PACh. 5 - Prob. 5.1CTECh. 5 - Prob. 5.2CTE
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Similar questions
- Historically, vaccinations have prevented the spread of certain diseases such as chicken pox or meningitis. What type of externality takes place with the consumption of such vaccines. Explain with words and a graph.arrow_forwardThe market for seasonal flu shots is depicted in the graph. As more people receive flu shots, fewer people catch the flu and there are fewer people to pass the flu along to others. Therefore, the chance of catching the flu decreases for everyone, even those who do not purchase a flu shot. This is an example of a positive externality. The demand curve in the graph measures private marginal benefits, and the supply curve measures the marginal cost of flu shots. The demand curve ignores external benefits of flu shots. Graph the social demand curve by placing the end points of the marginal social benefit curve at the correct locations. Then, shade the dead weight loss to society by placing the DWL triangle in the correct location. The Market for Flu VaccinationsPrice ($)Quantity of flu shotssupplymarginal private benefitmarginal social benefitDWLDWL Based on the graph, which statement about flu vaccines is true? People who get vaccinated primarily consider the health benefits to the…arrow_forwardThe Centers for Disease Control and Prevention estimates that every alcoholic drink consumed generates roughly $2 in external economic costs. 1. Explain whether the market for alcohol is best described as one with negative or positive externalities. Without any government intervention, is the quantity of alcohol traded too high or too low? 2. Briefly describe how you would model this externality in a supply and demand diagram (e.g. would you draw a social marginal cost curve or a social marginal benefit curve?). 4. Suppose you're advising Governor Holcomb on alcohol policy. Would the materials this week suggest a tax or a subsidy would be a good policy, and how much in dollars should the policy be?arrow_forward
- #9. A safe and effective coronavirus vaccine has positive externalities. Is it efficient for the government to provide this vaccine to everyone for free? a. Yes. Goods with positive externalities should always be free. b. Uncertain. Goods with positive externalities should be subsidized, but making them free is not necessarily efficient. c. No. According to the First Fundamental Welfare Theorem, the market will provide the efficient amount of vaccines on its own. с. d. No. Goods with positive externalities should be taxed.arrow_forwardThe market for seasonal flu shots is depicted in the graph. As more people receive flu shots, fewer people catch the flu and potentially pass it on to others. Therefore, the chance of catching the flu decreases for everyone, even those who do not purchase a flu shot. This is an example of a positive externality. The graph contains the private demand curve (D1) and the supply curve. D1 does not take into consideration the social benefit of people getting flu shots. Graph the social demand curve by placing the end points of D2 at the correct locations. Then, indicate the dead weight loss to society by placing the DWL triangle in the correct location on the graph. The Market for Flu Vaccinations D2 (marginal soeial benefit) DWL supply D1 (marginal private benefit) Quantity of flu shots Price ($)arrow_forwardWhat exactly do economists mean when they say "internalizing an externality"? Explain why it may be difficult to internalize some externalities.arrow_forward
- Which of the following illustrates the concept of externalaties? A. A hurricane destroys a production plant causing the owner of the plant to spend more money rebuilding B. Pollution by a coal mining plant causes a farmer to spend more money on fertilizer to improve his crop C. Increase in the price of sugar raises the price paid by consumers of soda, thereby disadvantaging these consumers D. Smoking harms the health of the smokerarrow_forwardThe Centers for Disease Control and Prevention estimates that every alcoholic drink consumed generates roughly $2 in external economic costs. Suppose you're advising the Governor on alcohol policy. Would information about externalities suggest a tax or a subsidy would be a good policy, and how much in dollars should the policy be?arrow_forward
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