To ensure all students are protected from getting the flu this year,your school offers free flu shots.What type of externality exists in this example?
A) Negative consumption externality.
B) Positive consumption externality.
C) Positive production externality.
D) Negative production externality.
E) Neutral externality.

Question

Quizplus · Accepted Answer

The provision of free flu shots to all students not only protects those individuals from getting the flu, but it also has a positive spillover effect onto the wider community. By reducing the likelihood of flu transmission within the student body, this leads to a reduction in the number of cases in the wider community. This is an example of a positive consumption externality.

To Ensure All Students Are Protected from Getting the Flu