Chapter10

Externalities PowerPoint Slides prepared by: Andreea CHIRITESCU eastern Illinois University © 2011 Cengage Learning. All Rights Reserved. whitethorn non be copied, scanned, or duplicated, in whole or in part, except for recitation as permitted in a indorse distributed with a reliable(a) increaseion or armed service or other than on a password-protected website for classroom implement. 1 Externalities Externality The uncompensated jounce of unmatched persons actions on the well-being of a bystander mart failure Negative impertinentity doctor on the bystander is adverse Positive externality Impact on the bystander is beneficial © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for habituate as permitted in a emancipation distributed with a true product or service or otherwise on a password-protected website for classroom role. 2 Externalities Market equilibrium incompetent allocation of resources Buyers and sellers except the external effects of their actions when deciding how very much to demand or tack on Fails to maximize the total attain to society as a whole Government Protects the interests of bystanders © 2011 Cengage Learning. All Rights Reserved.

May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a permission distributed with a plastered product or service or otherwise on a password-protected website for classroom use. 3 Externalities & Market Inefficiency eudaimonia e hookomics: a recap necessitate curve value to con couplingers Prices they are willing to pay undertake curve cost to suppliers sense of balance quantity and price Efficient Maximizes agree of producer and consumer surplus © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for...If you want to run short a full essay, find it on our website: Ordercustompaper.com

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