2.8 NEGATIVE EXTERNALITIES

Question 1

MPC stands for

Answer 1

marginal private cost

Question 2

MEC stands for

Answer 2

marginal external cost

Question 3

MSC stands for

Answer 3

marginal social cost

Question 4

MPB stands for

Answer 4

marginal private benefit

Question 5

MEB stands for

Answer 5

marginal external benefit

Question 6

MSB stands for

Answer 6

marginal social benefit

Question 7

whats a negative externality

Answer 7

costs incurred by third parties (eg. pollution)

Question 8

whats a marginal private cost (MPC)

Answer 8

additional cost incurred by a producer when producing one more unit of a good or service

Question 9

whats a marginal external cost (MEC)

Answer 9

measures the potential harm or benefit to 3rd parties

Question 10

whats marginal social cost (MSC)

Answer 10

supply curve that fully appreciates the positive and negative externalities of production

Question 11

how do you calculate MSC

Answer 11

MPC + MEC

Question 12

what is marginal private benefit (MPB)

Answer 12

measures the personal value the consumer places on a good or service

Question 13

whats a marginal external benefit (MEB)

Answer 13

measures the potential good or harm to the 3rd parties

Question 14

whats marginal social benefit (MSB)

Answer 14

a demand curve that fully appreciates the motive or negative externalities in consumption

Question 15

how to calculate MSB

Answer 15

MPB + MEB

Question 16

which of the externalities are supply side

Answer 16

MPC, MEC, MSC

Question 17

which of the externalities are demand side

Answer 17

MPB, MEB, MSB