📚 Learning Guide
Externalities and Their Effects
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Which of the following is an example of government intervention to promote positive externalities?

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Learning Path

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Choose the Best Answer

A

Subsidizing education to increase societal knowledge

B

Imposing taxes on pollution

C

Regulating monopolies to promote competition

D

Reducing tariffs on imported goods

Understanding the Answer

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Answer

An example of government intervention to promote positive externalities is when a government provides funding for public education. Education benefits not only the individual student but also society as a whole by creating a more informed and skilled workforce. When the government invests in schools and universities, it encourages more people to pursue education, leading to higher overall productivity and economic growth. For instance, a well-educated population can lead to lower crime rates and better health outcomes, which benefits everyone. By supporting education, the government helps to create these positive effects that might not happen if left solely to private individuals.

Detailed Explanation

When the government gives money for education, it helps everyone learn more. Other options are incorrect because Some might think that taxing pollution helps everyone, but it's meant to reduce harm, not promote good; Regulating monopolies is about stopping one company from controlling everything.

Key Concepts

positive externalities
government intervention
Topic

Externalities and Their Effects

Difficulty

medium level question

Cognitive Level

understand

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