Asked by Poppin galaxy on Jun 28, 2024
Verified
Two types of private solutions to the problem of externalities are
A) charities and the Golden Rule.
B) charities and subsidies.
C) the Golden Rule and taxes.
D) taxes and subsidies.
Private Solutions
Individual or business-driven approaches or measures taken to resolve issues without the need for government intervention.
Externalities
Externalities are the positive or negative effects of economic activities on third parties that are not reflected in the cost of the goods or services involved.
Golden Rule
A principle denoting the optimal level of saving in an economy that results in the highest possible steady-state level of consumption.
- Apply the Coase theorem to real-world externality problems and private solutions.
Verified Answer
Learning Objectives
- Apply the Coase theorem to real-world externality problems and private solutions.
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