Asked by Silvia Sanchez on May 12, 2024
Verified
A study that compares the costs and benefits to society of providing a public good is called externality analysis.
Externality Analysis
The examination of costs or benefits that affect parties who are not directly involved in a transaction or activity, used to understand the implications of external effects on society.
Public Good
A product or service that is available for all members of society to consume, regardless of whether they contribute to its provision.
- Understand the importance of externalities and their evaluation.
Verified Answer
SW
Shannon WisnoskiMay 19, 2024
Final Answer :
False
Explanation :
A study that compares the costs and benefits to society of providing a public good is called cost-benefit analysis. Externality analysis specifically examines the costs and benefits that are not reflected in market prices due to external effects on third parties.
Learning Objectives
- Understand the importance of externalities and their evaluation.