Positive Externalities
Education would be an example of this type of externality.
What is a positive externality in consumption?
A factory polluting the air would be an example of this type of externality.
What is a negative externality in production?
This measures the responsiveness of demand to a change in price.
What is the price elasticity of demand?
This measures the responsiveness of demand to a change in income.
What is income elasticity of demand?
Netflix is an example of this type of good.
What is a quasi-public or club good?
With a positive externality, society wants _____ of a good or service.
What is more?
With a negative externality, society wants _____ of a good or service?
What is less?
This is the formula for price elasticity of demand.
What is the percentage change in quantity demanded over the percentage change in price?
This is the formula for cross-price elasticity.
What is the percentage change in quantity demanded for good A over the percentage change in price for good B?
This is an example of a private good.
Positive externalities can be solved with this government intervention.
What are subsidies?
Negative externalities can be solved with this government intervention.
What are taxes?
Something is perfectly inelastic when the demand curve looks like this.
What is vertical or straight up and down?
Two goods are complements when the cross-price elasticity is this.
What is negative?
These types of goods are non-excludable and non-rival.
What are public goods?
Given a positive externality in production, our normal supple curve becomes this.
What is the private marginal cost curve?
Given a negative externality in consumption, our normal demand curve becomes this.
What is the private marginal benefit curve?
This letter represents the point on the curve that is unit elastic. (Slide 4)
What is point B?
A good is normal and a luxury when income elasticity of demand is this.
What is positive and greater than one?
Common resources are ______. (In terms of excludability and rivalry)
What are non-excludable and rival?
This point represents the DWL. (Slide 5)
What is point A?
This point represents the DWL. (Slide 6)
What is point B?
The price of a good was originally $2 and 200 units were sold. When the price was increased to $2.50 only 150 units were sold. The price elasticity of demand is this.
What is negative one?
The price of a good was originally $5 and 600 units were produced. When the price was increased to $7 700 units were produced. The price elasticity of supply is this.
What is about 0.417?
When finding the market demand for public goods, you add up ________.
What are the prices at each quantity or add them vertically?