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Q: How do externalities affect the supply and demand curve? Please explain in detail with graphs and…
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A: An externality is a cost or benefit incurred or received to society due to the production process.
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Q: DRAW THE POSITIVE EXTERNALITY CURVE AND EXPLAIN-
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What is externality.
Explain its both types negative and positive too.
Step by step
Solved in 2 steps
- draw a graph of a product without any externalityAnswer to this Q?If it's possible to eliminate the problems created by externalities, why do they persist? Multiple Choice O O None of these statements is true. Correcting externalities would always reduce total surplus. It is difficult to measure external benefits and costs. The benefits of correcting the externalities generally exceed the costs.
- In your own words, how was the the great recession an externality?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.ASAP plz Why don't people/stores make different decisions? Cost is a factor: a case of foam take-out containers costs $25, compared with $58 for paper and recyclable-plastics. How does this affect the firm's profit? Are consumers willing to pay more? Negative externality Consider the demand and supply given above. Suppose there is an external cost given by MEC=5Q. Find social equilibrium price and quantity. Draw a graph and label both private and social equilibrium.
- Explain 'negative externalities,' defined in class as 'hidden costs' making the difference between the 'public market price' and the 'true price' of a product. Illustrate using an example of a product with a negative externalityWhich activity generates a negative externality? O The only two hardware stores in town agree to form a cartel and fix prices. O You buy a neA Lexus and then discover it needs a new alternator. O After Judith buys life insurance, she begins skydiving classes on the weckends. O Your neighbor starts his noisy construction project at 6:00 a.m. on weekends.Use a supply and demand graph to show a good which should be illegal owing to it's negative externality.
- A local school administrator observes an increase in the number of flu cases in the public schools over the last two years. She is concerned that some families cannot afford flu vaccine and are therefore not having children vaccinated. She is also concerned that the failure to vaccinate some children is putting other children at risk, so she proposes that the state subsidize vaccines to increase coverage rates. a. Determine whether the failure to vaccinate some children is an external benefit or an external cost. If an external cost is present, move point A and point B to show the marginal social cost curve. If an external benefit is present, move point A and point B to show the marginal social benefit curve. Place point C at the equilibrium outcome. Place point D at the socially optimal outcome. Flu vaccines A B D Supply (marginal private cost) PriceRicky, a retired railroad conductor and Lucy, a full time lab technician are next door neighbors in an apartment building. Ricky loves to play loud heavy metal music, which can be heard for hours during the evening.Lucy can't stand heavy metal, which often rattles the wall of her small apartment from the large speakers next door. A. What is the externality in the example above? B. What command-and-control policies might the landlord impose? Could such policies lead to an inefficient outcome? C. If the landlord refuses to get involved in the despute. Based on the ideas associated with the Coase theorem, how might Ricky and Lucy reach an efficient outcome on their own? What might prevent them from reaching an efficient outcome?The following graph represents the market for high-emissions cars. Answer this question assuming that the externality is not internalised. Which quantity is socially optimal (i.e. what is the efficient quantity)? What is the deadweight loss generated by the externality?
