Complete Question:
Match the following examples to the correct term.
Tiles.
a. Increased neighborhood crime is caused by a pawn shop.
b. Jeff declined to buy his favorite chocolate bar because the price has increased.
c. Public education in the United States results in benefits for others around the world.
d. A freeway is available for all to use.
Pairs.
1. Negative externality.
2. Dollar vote.
3. Public goods.
4. Positive externality.
Answer:
1. Negative externality: Jeff declined to buy his favorite chocolate bar because the price has increased.
2. Dollar vote: increased neighborhood crime is caused by a pawn shop.
3. Public goods: a freeway is available for all to use.
4. Positive externality: public education in the United States results in benefits for others around the world.
Explanation:
1. Negative externality: Jeff declined to buy his favorite chocolate bar because the price has increased. A negative externality arises when the production or consumption of a finished product or service has negative impact (cost) on a third party.
2. Dollar vote: increased neighborhood crime is caused by a pawn shop. A dollar vote describes how the consumer's purchasing power influences the type (quantity) of goods to be produced and supplied to the market.
3. Public goods: a freeway is available for all to use. It refers to any goods that is accessible and available to the general public at all times without an additional fee, charges or cost.
4. Positive externality: public education in the United States results in benefits for others around the world. A positive externality arises when the production or consumption of a finished product or service has a significant impact or benefits to a third party that isn't directly involved in the transaction.
