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Sunday, December 29, 2013

Describe and evaluate economic measures that can be used to reduce negative consumption and negative production externalities ...

i         Externalities be cost or pull aheads of occupation or use of goods and improvements experienced by the society who are not straightway involved or had not paying(a) for it. It is sometimes referred to as spillover or third-party costs or benefits. (Sloman & angstrom; Norris 2002, p567) A benefit experienced by the society or third-party who are not directly involved when a harvesting or service is consumed or produced by a person or a firm is known as a arrogant externality. Ex ampereles of positive production and expending externalities are education, wellness provision, vaccination and researching of raw technologies.         Negative wasting disease externalities occur when the costs of consumption is borne by other lot other than the consumer. (Sloman & Norris 2002, p271) The society would therefore prefer lesser of these kinds of goods and services to be consumed. Examples of negative consumption externalities are negative externalities created by smoke and alcohol abuse, taint from cars and motorbikes, vandalism of public property, illegal racers and litter on path and public places. (Margetts)         To decrease negative consumption externalities, the establishment could change magnitude the taxes or excise enforce on these goods or services. (Hall 1996) change magnitude the taxes on these goods or services would cause the price to rise.
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This would indeed discourage the consumers from buy it or decrease the amount which they would or could buy. With the increase in taxes, there would be more tax revenue for t he government to spend on. However, this mig! ht stir other consumers and accepted firms in the industry. For example, if there was an increase of taxes imposed on alcohol, it would affect the wine-coloured industry and lessen their revenue. It would also affect the people who drinks solely moderately and who had not caused any problems to the society. Increasing taxes on the goods does not necessary mean that people... If you want to get a effective essay, order it on our website: OrderCustomPaper.com

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