With the coronavirus vaccine, your decision to get vaccinated provides not just a benefit to yourself in protecting you from the disease, it also provides substantial benefits to others who you are likely to encounter during the course of your daily activities, protecting them from infection as well. This is an example of O Public good O Negative externality O Positive externality O Common ownership O Asymmetric information
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- Herd immunity is a negative health externality. O True O FalseConsider an infectious disease such as the flu which is spread primarily through virus particles in aerosolized respiratory droplets of already infected people. a In the midst of an infectious disease epidemic of this sort, is it privately rational for people to limit their exposure to other people, perhaps by staying home from work or not going to school? b An infected person who goes out into public areas and does not take precautions to contain their respiratory emissions clearly poses a negative externality on those around them. Does an uninfected person going out into public areas also pose a negative externality? c For a particularly severe disease outbreak of this sort, one possible government response is to exaggerate to the public both the harm that might arise from contracting the disease and the likelihood of contracting the disease. In what ways might such a strategy reduce the harm to the public from the disease epidemic? In what ways might such a strategy increase the…Consider a factory, located in the middle of nowhere, producing a nasty smell. As long as no one is around toexperience the unpleasant odor, are any externalities produced? Suppose that there was family next door to the smelly factory. Do we now have an externalities problem?Suppose that the family clearly possesses the right to a pleasant-smelling environment. Does this mean thatthe factory will be required to stop producing the bad smell? What can be a private solution to this problem?
- Consider two ways to protect your car from theft.The Club (a steering wheel lock) makes it difficult fora car thief to take your car. Lojack (a tracking system)makes it easier for the police to catch the car thiefwho has stolen it. Which of these methods confersa negative externality on other car owners? Whichconfers a positive externality? Do you think there areany policy implications of your analysis?1. Governments and pharmaceutical companies rushed quickly ahead to develop a vaccine. Vaccinations and immunizations are examples of positive externalities. A positive externality is when an activity creates a benefit for those who are not involved in the transaction, a third party. Let’s examine the vaccination of Covid-19 as a positive externality. Question: Why is the Covid-19 vaccination considered a positive externality? 2. Considering the information provided and your responses to Question 3 explain the potential unintended consequences of each one of these polices. Which policy would you enact and why?What is the problem of moral hazard?
- Do market demand curves reflect positive externalities? Why or why not?1. How did Covid-19 affect businesses and the overall economy? 2. Governments and pharmaceutical companies rushed quickly ahead to develop a vaccine. Vaccinations and immunizations are examples of positive externalities. A positive externality is when an activity creates a benefit for those who are not involved in the transaction, a third party. Let’s examine the vaccination of Covid-19 as a positive externality. Question: Why is the Covid-19 vaccination considered a positive externality? 3. Market supply curve S and private demand curve Dp represent the market for vaccinations. Equilibrium is at point e, and the number of people getting the vaccination is Qe. Society would benefit, however, if more people would get the vaccination. Demand curve DS represents the marginal social benefit (MSB), which includes the private demand for vaccinations plus the external benefits that flow from it. Socially optimal enrollment would be Q1 (point f). Society would benefit the most by…12 Demand elasticity and social loss. Consider two vaccines for difffferent viruses χ and Ω Assume that the marginal cost of producing both drugs is constant and that the fixed cost is small. In other words, assume that the supply curve for both drugs is flat. a Suppose that demand for vaccine χ is price elastic, whereas demand for vaccine Ω is relatively inelastic. Plot the private demand curve for both drugs on separate axes. b For the sake of example, assume that both viruses have the same externality. Plot the social demand curve for both drugs and label the social loss in each case. c Explain intuitively why, all else equal, social loss is greater in the case of elastic demand than it is in the case of inelastic demand.
- "Wearing mask and using the sanitizer has helped in controlling the spread of COVID-19". This statement is O a. All of these given options O b. A question O c. An opinion o d. Scientifically provenDo COVID-19 Vaccines create external benefit? Why? Then should the government subsidize this activity?An increase in globalization has lead to an increase in pollution, and this is a problem because pollution is seen to be the classic example of a This is a that individuals impose on others but do not pay for. O negative externality, cost O possitive externality, benefit O negative externality, benefit O possitive externality, cost