Thursday, November 01, 2012

Unit 1: Carbon monoxide monitors: An example of merit goods?

In Northern Ireland new rules insist carbon monoxide monitors are fitted

http://www.bbc.co.uk/news/uk-northern-ireland-20156809#

a) Why are there monitors underconsumed in the free market?
b) What positive externalities do they produce?
c) To what extent do you think the new regulations will reduce the market failure(ie the cases of carbon monoxide poisoning)

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