Market Failure
What do we call the situation in wich there's a surplus of supply?
Overproduction
what can be an example of negative market externality?
Factory dumps chemicals into nature
What is a negative externality that often comes with raising minimum wage?
Unemployment increases
Whats a free rider?
Someone who exploits public goods without contributing
Who decides a public choice?
The common public, or the majority
What do we call the situation in wich there's a shortage of supply?
Underproduction
What can be an example of positive government externality?
Government funding school benefits society
What can be an example of negative market externality?
A factory dumps chemicals into nature
Name the 2 Characteristics of a public good
Non-Exclusive
Non- Rivalry
Voters/Firms/Politicians/Bureaucrats
What happens in the market when there is a failure?
A desequelibrium between supply and demand
What’s externality?
Affecting a third party by actions of consumer or producer without changing market prices
What Is price ceiling?
When the government imposes by law that a certain good or service cannot be priced above a certain level
Who pays for a public good?
The citizens but they pay it thorugh taxes from the government
Why can't public goods be provided by private companies?
The nature of certain goods may be public by nature and its not efficient to attempt otherwise.