Tuesday, December 02, 2008

Unit 1: Roadworks and negative externalities

From the BBC comes this sorry tale of shops in severe difficulties due to roadworks

http://news.bbc.co.uk/1/hi/business/7755218.stm

a) Who are the 2 parties to the economic transaction?
b) Define what is meant by the term negative externalies
b) Explain why the shops are suffering negative externalities in this example

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