Question

Question 6 (1 point) Global warming is described as a horizon. negative externality with a time a) large; short b) small; short c) small; long d) large; long

Answer 1

Global warming is describes as a large negative externality with a long time horizon.

d)large;long

(An externality may be a cost or a benefit which may arise from the production or consumption of a good or service.However this cost or benefit is not borne or received by the producer of the externality,or the entity which causes the externality.An externality may be positive or negative.The effects of the externality may be private or social.When an externality has private effects it might affect an individual or organisation.When an externality has social effects it affects the society as a whole.

Positive externality occur when there is a positive benefit on the private as well as the social level.Like when an there is an increase in the educational sector,it will lead to a better educated population,also it would give rise more educated and intelligent workforce.When companies hire such employees they benefit from their knowledge as well.Also education would benefit the society as a whole.

On the other hand,negative externality occur when the action of an individual or an organisation have ill effects on the society as a whole.One such example is global warming,which is the result of the toxic and dangerous materials into the environment by factories.However emission from factories is not the only reason which causes global warming,however it plays an important role in global warming.As we know that global warming has lead to a large number of negative effects on the world as a whole.

Thus we can say that Global warming is a large negative externality,because it has affected the entire world and not just a section of it,and it has a long term horizon as the effects of global warming have long lasting effects which affects us in the present,and also it will affect the future generations as well.)