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The problem with externalities is essentially one of

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The problem with externalities is essentially one of

The problem with externalities is essentially one of

▸ the failure of the market to solve social problems.

▸ the inability of a firm in an industry characterized by increasing returns to scale to make positive profits if it sets price equal to marginal cost.

▸ asymmetric information.

▸ a failure of the market to generate socially valued outcomes.

▸ a discrepancy between private and social costs.

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Microeconomics

Edition: 17^th

Author: Ragan

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