Economics · Market Failure and Positive Externalities
Consider the following pairs regarding the characteristics and correction of positive externalities: 1. Primary Cause of Inefficiency : Unremunerated benefits conferred on third parties2. Resource Allocation Outcome : Underproduction relative to the socially optimal level3. Corrective Policy Instrument : Subsidy equal to the Marginal External Benefit (MEB) How many of the above pairs is/are correctly matched?
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All three
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