what is externalities? Mention it's 2 types???
Answers
Answer:
What Is an Externality?
An externality is a cost or benefit caused by a producer that is not financially incurred or received by that producer. An externality can be both positive or negative and can stem from either the production or consumption of a good or service. The costs and benefits can be both private—to an individual or an organization—or social, meaning it can affect society as a whole.
Externalities by nature are generally environmental, such as natural resources or public health. For example, a negative externality is a business that causes pollution that diminishes the property values or health of people in the surrounding area. A positive externality includes actions that reduce transmission of disease or avoids the use of lawn treatments that runoff to rivers and thus contribute to excess plant growth in lakes. Externalities are different from donations of parkland or open-source software.
Understanding Externalities
Externalities occur in an economy when the production or consumption of a specific good or service impacts a third party that is not directly related to the production or consumption of that good or service.
Almost all externalities are considered to be
Answer:
In economics, an externality or external cost is an indirect cost or benefit to an uninvolved third party that arises as an effect of another party's activity. Externalities can be considered as unpriced goods involved in either consumer or producer market transactions.
Explanation:
In economics, there are four different types of externalities: positive consumption and positive production, and negative consumption and negative production externalities. As implied by their names, positive externalities generally have a positive effect, while negative ones have the opposite impact.