Answer to Question #292632 in Microeconomics for Ayman

Question

Positive externalities create ________ spillover ___________. The result is that the __________ benefit of production/consumption is greater than the __________ benefit. External benefits might be in the form of lower __________ for other parties or __________ revenues/profits for other parties.

Answer 1

Positive externalities create third party spillover benefits. The result is that the social benefit of production/consumption is greater than the private benefit. External benefits might be in the form of lower prices for other parties or greater revenues/profits for other parties.