Which of the following is a real-world example of a positive externality?
A)You are craving a soda for lunch. However, the customer ahead of you in line at the hot dog stand buys the last can.
B)National defense is available even for people who do not pay income taxes.
C)A person seated in a non-smoking section of a restaurant decides to sneak a few puffs of a cigarette.
D)A child receives a vaccination to prevent the spread of measles.

Question

Quizplus · Accepted Answer

A positive externality is a benefit that is enjoyed by a third party as a result of an economic transaction. In this case, when a child receives a vaccination to prevent the spread of measles, not only is the child protected from the disease, but other people are also protected from the spread of the disease. This is a positive externality because the benefit of the vaccination extends beyond the person receiving the vaccine. When a child receives a vaccination, not only is the child protected from getting measles, but the vaccination also helps prevent the spread of measles to others. This is a positive externality because the benefit of the vaccination extends beyond just the individual receiving it.

Which of the Following Is a Real-World Example of a Positive