1.6 externalities

Question 1

private good

Answer 1

a private good is a type of good that is both dynamic and excludable.

Question 2

public good

Answer 2

A public good is a type of good that is non-dynamic and non-excludable.

Question 3

quasi public good

Answer 3

Quasi-public goods, also known as club goods or semiprivate goods, share some characteristics with both public goods and private goods

Question 4

free rider problem

Answer 4

The free rider problem occurs when individuals benefit from a good or service without directly contributing to its cost or funding.

Question 5

exclusivity

Answer 5

exclusivity refers to the ability to prevent certain individuals or groups from accessing or using a good or service, usually based on whether they can afford

Question 6

merit goods

Answer 6

merit goods are goods or services that are considered to have positive externalities

Question 7

demerit goods

Answer 7

demerit goods are goods or services that are considered to have negative externalities

Question 8

imperfect information

Answer 8

Imperfect information in economics refers to situations where individuals, firms, or governments do not have complete or accurate knowledge about relevant factors,

Question 9

paternalism

Answer 9

Paternalism in economics refers to the idea that governments or other authorities should intervene in individuals’ decisions to promote their well-being

Question 10

moral hazard

Answer 10

moral hazard refers to a situation where one party in a transaction takes on more risk because they do not bear the full consequences of that risk

Question 11

adverse selection

Answer 11

Adverse selection in economics refers to a situation in which one party in a transaction has more information than the other,

Question 12

social costs

Answer 12

Social costs = total cost to society​
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Question 13

Private costs = faced / paid directly by the producer or consum

Question 14

External cost = negative externalities​