📚 Learning Guide
Positive Externalities in Consumption
hard

Arrange the following stages in the process of addressing positive externalities in consumption to promote societal wellbeing: A) Government identifies a positive externality, B) Policies are implemented to encourage consumption, C) Increased consumption leads to societal benefits, D) Evaluation of the effectiveness of policies.

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Choose the Best Answer

A

A→B→C→D

B

B→A→C→D

C

A→C→B→D

D

A→B→D→C

Understanding the Answer

Let's break down why this is correct

Answer

To address positive externalities in consumption, the process begins when the government identifies a positive externality. This means they recognize that certain goods or services, like education or public parks, provide benefits not just to the individual using them but also to society as a whole. Next, the government implements policies to encourage more people to consume these goods, such as subsidies or tax breaks. As a result of these policies, increased consumption occurs, leading to greater societal benefits, like a more educated population or improved public health. Finally, it's important for the government to evaluate how effective these policies have been in achieving their goals, ensuring that the benefits continue to grow.

Detailed Explanation

First, the government sees a good thing happening, like more people using public parks. Other options are incorrect because This suggests making rules before knowing what the good thing is; This order skips the important step of making rules.

Key Concepts

Positive Externalities in Consumption
Government Policy Intervention
Societal Wellbeing
Topic

Positive Externalities in Consumption

Difficulty

hard level question

Cognitive Level

understand

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