This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: What does it mean to say that an individual or a firm has internalized an externality? What will ... (Read 48 times)

lilldybug07

  • Hero Member
  • *****
  • Posts: 546
on: Jun 29, 2018
What does it mean to say that an individual or a firm has internalized an externality?
 
  What will be an ideal response?

Question 2

When the economy goes into recession, the biggest increase in unem-ployment is _________.
 
  A. structural because jobs are lost in most states
  B. cyclical because jobs are lost in many industries as they cut production
  C. frictional because the creation of jobs slows
  D. the combination of structural and frictional as few new jobs are created.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

ankilker

  • Sr. Member
  • ****
  • Posts: 328
Reply #1 on: Jun 29, 2018
Answer to Question 1

Externalities are external costs or benefits that firms or consumers do not consider when making decisions. When incentives are altered such that an externality is taken into account, firms and individuals are said to have internalized the externality. So, for example, suppose I raise bees next door to your apple orchard. The bees pollinate your tress and so there is an externality. The externality will be internalized if I buy your orchard.

Answer to Question 2

B Cyclical unemployment is the unemployment resulting from a recession.


lilldybug07

  • Member
  • Posts: 546
Reply 2 on: Jun 29, 2018
YES! Correct, THANKS for helping me on my review

Liamb2179

  • Member
  • Posts: 365
Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

« previous next »
 

Did you know?

Excessive alcohol use costs the country approximately $235 billion every year.

Did you know?

The eye muscles are the most active muscles in the whole body. The external muscles that move the eyes are the strongest muscles in the human body for the job they have to do. They are 100 times more powerful than they need to be.

Did you know?

Amphetamine poisoning can cause intravascular coagulation, circulatory collapse, rhabdomyolysis, ischemic colitis, acute psychosis, hyperthermia, respiratory distress syndrome, and pericarditis.

Did you know?

Inotropic therapy does not have a role in the treatment of most heart failure patients. These drugs can make patients feel and function better but usually do not lengthen the predicted length of their lives.

Did you know?

Children with strabismus (crossed eyes) can be treated. They are not able to outgrow this condition on their own, but with help, it can be more easily corrected at a younger age. It is important for infants to have eye examinations as early as possible in their development and then another at age 2 years.

An individual affected by xeroderma pigmentosum An individual affected by xeroderma pigmentosum
A tail from a different individual - the tail of each humpback whale is visibly unique. A tail from a different individual - the tail of each humpback whale is visibly unique.
A nearly motionless individual, alert to danger, will whistle when alarmed to warn other groundhogs A nearly motionless individual, alert to danger, will whistle when alarmed to warn other groundhogs
J. P. Morgan, the financial genius, staved off ruinous competition among steel firms by combining mo J. P. Morgan, the financial genius, staved off ruinous competition among steel firms by combining mo
Basic two-handed kneading. Tissues are lifted with the whole hand in firm contact. Basic two-handed kneading. Tissues are lifted with the whole hand in firm contact.
Niche: An individual’s ecological role Niche: An individual’s ecological role
Video: Male Reproductive System - The gonadotropin releasing hormone

For a complete list of videos, visit our video library