Negative Externalities are: A. External Benefits B. Non-excludable C. External Costs D. Non-Rivalous What term was coined by Adam Smith and is a metaphor for an economic guidance system that leads to desirable economic outcomes? A. Competition B. Price mechanism C. Capitalism D. "The invisible hand" What are the two characteristics of a public good? (Choose 2) A. External Cost B. Non excludable C. External Benefit D. Non-Rivalous
- Negative Externalities are:
A. External Benefits
B. Non-excludable
C. External Costs
D. Non-Rivalous -
What term was coined by Adam Smith and is a metaphor for an economic guidance system that leads to desirable economic outcomes?
A. CompetitionB. Price mechanismC. CapitalismD. "The invisible hand" - What are the two characteristics of a public good? (Choose 2)
A. External Cost
B. Non excludable
C. External Benefit
D. Non-Rivalous
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A cost or benefit that a producer creates but does not personally bear or receive is known as an externality. An externality is a cost or benefit of an economic activity that is experienced by a distinct third party. Due to the market's failure to fully price the external effects caused by some economic activities, externalities have an impact on resource allocation. When people, households, and businesses fail to internalise the indirect costs or benefits of their economic transactions, externalities pose serious issues for economic policy. Inefficient market outcomes are the result of the resulting wedges between social and private costs or returns.
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