Question

I think externalities are things that can be predicted through analysis. If externalities can be controlled, the company's benefits can be greatly improved by producing complementary products. I think the evaluation of externalities needs to analyze the target customer group of this project and other projects that complement the project. How do you think?

Answer 1

Externality is all such economic cost and benefit that are related to an unrelated third party.this cost will not be reflected in their overall cost or these benefits will also not be reflected in their overall benefit so externalities will be making the market inefficient and causing serious problems regarding transparency of the markets and hence the company should be trying to always predict externalities in order to hedge itself from the negative externalities to large extent.

When the company is getting exposed to the positive externalities in form of infrastructural development or research and development activities or educational activities or vaccination opportunities, so the company should be trying to make complementary goods in order to maximize upon the opportunities which had been provided to it by the positive externalities, so that it will be able to maximize upon its externalities benefit and evaluation of the externalities in in advance will be helping the company in order to target the specific consumer groups who are going to consume these complementary goods and services so there will be various types of products like relation to education which will be entering into various kinds of establishment of schools and ownership of schools along with ownership of stationary projects or it can even enter to various kinds of vaccination opportunities which will be resulting out of the medical disasters like one can enter into a pharmaceutical business at the time of pandemic like current pandemic which is provider positive externality to those businesses who are willing to enter into the pharmaceutical business and try research and development in relationship to the vaccine and generator market share for themselves so the business should be constantly trying to formulate all such complementary goods and services which will be maximizing its rate of return in the long run and generating value for the company by elimination of risk.