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Madison Donahue
on Nov 25, 2024

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Where there are spillover (or external) benefits from having a particular product in a society, the government can make the quantity of the product approach the socially optimal level by doing the following, except

A) subsiding the buyers of the product.
B) taxing the sellers of the product.
C) subsidizing the sellers of the product.
D) providing the product itself.

Spillover Benefits

Spillover benefits occur when an economic activity positively affects unrelated third parties or the broader community, beyond the immediate buyer and seller.

Socially Optimal

A state or condition in which resources are allocated in the most efficient manner from a societal perspective, maximizing benefits and minimizing costs to the society as a whole.

  • Scrutinize the repercussions of external positives and negatives on the dynamics of market results.
  • Recognize the part of government responses in mending market glitches induced by externalities.
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Ayesha KhalidNov 28, 2024
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