A malaria-infected village decides to establish a mosquito eradication program. The program costs $5 million in...

A malaria-infected village decides to establish a mosquito eradication program. The program costs $5 million in order to be effective, and each village inhabitant is asked to voluntarily contribute to the fund. The mosquito eradication program is never implemented, and the village continues to have a malaria problem.

Which economic concept best explains this outcome?

(A) Deadweight Loss.
(B) Government Failure.

(C) Public Goods Game.

(D) Negative Externalities.

20. You go to the library to study for your exams. A cringe boomer sits beside you, and starts blasting his 1980s boombox radio, making it difficult for you to concentrate. Which economic concept best explains this situation?

(A) Deadweight Loss.
(B) Government Failure.

(C) Public Goods Game.

(D) Negative Externalities.

Expert Solution

19.

C public goods game

In case of a provision of a public good the members of the society needs to contribute for the good which is non excludable in nature.i.e. when the the service of the good is provided no one can be excluded from that service. But in case of a typical citizen they may not choose to contribute to the public good because they will be benefited same as who contributed for the public good.

This is free rider problem in case of public good. In this case the the mosquito eradication program never implemented because of lots of free riders among the village.

20.

D. Negative externality

An activity of an economic entity that directly affects the welfare of another entity in a way that is outside the market mechanism is called an externality. When the the consequence of the action is negative for someone else this is called as negative externality.i.e. in case of negative externality one's action is harmful for another.

Rahul Sunny answered 7 months ago

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