Chapter10

Externalities PowerPoint Slides prepared by: Andreea CHIRITESCU Eastern Illinois University © 2011 Cengage Learning. all told Rights Reserved. May not be copied, scanned, or duplicated, in self-colored or in part, except for recitation as permitted in a licence distributed with a reliable(a) product or service or otherwise on a password-protected website for schoolroom implement. 1 Externalities Externality The unsalaried jounce of one persons actions on the social welfare of a bystander Market failure Negative externality desex on the bystander is adverse Positive externality Impact on the bystander is beneficial © 2011 Cengage Learning. completely Rights Reserved. May not be copied, scanned, or duplicated, in complete or in part, except for accustom as permitted in a license distributed with a line up product or service or otherwise on a password-protected website for classroom use. 2 Externalities Market equilibrium i neffective allocation of resources Buyers and sellers except the external effects of their actions when deciding how more than to demand or supply Fails to maximize the total pull in 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 license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3 Externalities & Market Inefficiency Welfare economics: a follow-up Demand curve value to con couplingers Prices they are unbidden to pay try curve c ost to suppliers Equilibrium bill and pric! e Efficient Maximizes sum 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 motive to get a full essay, align it on our website: OrderEssay.net

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