Describe Spillovers and externalities
Describe Spillovers and externalities?
Expert
a. When profit / expenses of invention are not fully reflected in market demand/ supply schedules, Spillovers or externalities occurs. Several profit/expenses of a good may “spill over” to 3rd parties.
b. An example of a spillover cost is fumes, that allows polluters to enjoy lower production costs because the firm is passing along the cost of pollution damage or cleanup to society. As firm does not bear complete rate, it will overallocate resources.
c. Correcting for spillover costs requires that government get producers to internalize these costs.
d. Spillover benefits occur when direct consumption by some individuals impacts third parties. Public health vaccinations and education are two examples. Because some of the benefits accumulate to others whereas individuals will demand too little for themselves and resources will be underallocated by the market.
True or false? “U.S. exports create a demand for foreign currencies; foreign imports of U.S. goods generate supplies of foreign currencies.” Explain.
Illustrate the advantage and disadvantage of Partnership?
Question: Max has a utility function U =√ x1x2 where x1 is litres of ice-cream and x2 is boxes of strawberries. The marginal utility of a litre if ice-cream is
Describe GDP gap and Okun’s Law?
According to the advocates of free trade and World Trade Organization, each and every country potentially advantages from trade liberalization and the lowering of tariffs since each and every country: (1) Has a comparative benefit in something. (2) Ga
How can we compute operating leverage?
The price of KnickKnacks is $1 and the price of WigWags has increased with $2 to $3. Therefore: (w) absolute price of KnickKnacks has decreased and the relative price of WigWags has increased. (x) relative and absolute prices of KnickKnacks have
Why Trade barriers hurt American consumers?
What was rightward shift of PPC point out? Answer: It points out growth of the resources.
Dividing monetary prices from each other yields: (v) nominal prices. (w) relative prices. (x) subjective prices. (y) absolute prices. (z) transaction prices. Hello guys I want your advice. Please recommend some vie
18,76,764
1928340 Asked
3,689
Active Tutors
1458327
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!