1.3.2 Externalities

1. ... (negative externalities) are costs suffered by a third party as a result of an economic transaction, also known as spillover effects (8, 5)
5. ... private costs are the costs of producing the next item( which can also be the supply curve) (8)
6. Government ... to tackle negative externalities: Bans and regulation, Taxes, Education providing information, Subsidising alternatives and Pollution permits (8)

2. ... are a type of market failure because the market puts out the wrong signals (13)
3. ... is an application of polluter pays principle because it charges people depending on how much pollution they produce, the idea to keep a clean environment (5, 5)
4. The ... principle is when the people who create pollution, have to pay more money (8, 4)
5. ... private benefit is the extra benefit derived from consuming one more item (8)
8. ... is the the loss of economic efficiency that can occur when the free market equilibrium for a good or a service is not achieved (7, 4)
9. Examples of ... externalities include: Renewable energy supply, Public transport, Vaccinations, Education, Electric Vehicles, Fire Alarms, Insurance, New motorways and Inventions (8)
10. ... = Private costs + External costs (6, 5)

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