Chapter 10 - Externalities

negative externality

A(n) ________ can be considered the exhaust from automobiles.

external effects

When ________ are present, third parties must be taken into account when evaluating a market outcome.

Bipartisan action

________ is not on the White House or Congress 'agenda.

Social value

________ is more advantageous than private and it's above the demand curve.

Coase theorem

________: the proposition that if private parties can bargain without cost over the allocation of resources, they can solve the problem of externalities on their own.

externality

Polluting firms pay the government and it costs the government more by internalizing the ________.

EPA

The ________ can determine how many levels of pollution a factory can emit.

transaction

The ________ costs for a translator, lawyer, or attorney.

Social cost

________ curves and supply curves differ in the fact that they emit different amounts of pollution.

Outcomes

________ are efficient when buyers and sellers in markets are the only interested parties.

Pollution permits

________ are cost- effective ways of keeping the environment clean.

supply curve

The ________ reflects the cost of producing steel.

market equilibrium

The ________ is not efficient when there are externalities.

Transaction costs

________: the costs that parties incur during the process of agreeing to and following through on a bargain.

Externality

________: the uncompensated impact of one person's actions on the well- being of a bystander.