Podcast
Questions and Answers
What does the supply curve (Sprivate) show?
What does the supply curve (Sprivate) show?
- Quantity demanded at each price
- Quantity supplied taking social costs into account
- Quantity supplied by firms considering private costs only (correct)
- Quantity demanded considering external benefits
Where does the market equilibrium occur in this scenario?
Where does the market equilibrium occur in this scenario?
- $625 and a quantity of 47,000
- $650 and a quantity of 45,000 (correct)
- $550 and a quantity of 50,000
- $700 and a quantity of 40,000
What does the firm's supply curve become when external costs are taken into account?
What does the firm's supply curve become when external costs are taken into account?
- Ssocial (correct)
- Smarket
- Sprivate
- Sexternal
What happens to the equilibrium price and quantity when only private costs are taken into account?
What happens to the equilibrium price and quantity when only private costs are taken into account?
What does the negative externality in this situation refer to?
What does the negative externality in this situation refer to?
Why is it important to identify the equilibrium price and quantity when taking social costs into account?
Why is it important to identify the equilibrium price and quantity when taking social costs into account?
What happens when externalities exist?
What happens when externalities exist?
In the presence of pollution as an externality, what happens to the supply curve?
In the presence of pollution as an externality, what happens to the supply curve?
What is the consequence of market failure due to externalities?
What is the consequence of market failure due to externalities?
Why do economists refer to externalities as a market failure?
Why do economists refer to externalities as a market failure?
What would happen if firms were required to pay the social costs of pollution?
What would happen if firms were required to pay the social costs of pollution?
How does the presence of pollution impact the quantity of products produced in a market?
How does the presence of pollution impact the quantity of products produced in a market?
What is an externality in economics?
What is an externality in economics?
Which of the following best describes a negative externality?
Which of the following best describes a negative externality?
What is an example of a negative externality mentioned in the text?
What is an example of a negative externality mentioned in the text?
How are externalities sometimes referred to in market transactions?
How are externalities sometimes referred to in market transactions?
What do economists illustrate with a demand and supply diagram when it comes to externalities?
What do economists illustrate with a demand and supply diagram when it comes to externalities?
Which of the following best describes a positive externality?
Which of the following best describes a positive externality?
