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8a externalities
8a externalities
8a externalities
8a externalities
8a externalities
8a externalities
8a externalities
8a externalities
8a externalities
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8a externalities

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  • Good: Place to socialiseEasy to get drinksWIFI (?)MealsWatch SportBad: Litter – Cigarettes / Glass bottles etcDrunks – Maybe fights? Noisy – When you want to go to sleepLots of bad language (Which children hear)Urination of your propertyDepends on if this is a friendly pub with nice customers…
  • E.g. if a company decides to build a car park, a flat outside car park is cheaper to construct, but uses more space.
  • Car Park in Chicago – Looks like no barriers… Still not convinced about the razor thin wires…
  • Near Stowmarket Station
  • Transcript

    • 1. Good Neighbour?
    • 2. Types of Externality Private Cost Private benefit External Cost External benefit
    • 3. Private Costs Costs to the company of their actions Flat Car Park • Cheaper to build • Uses More Space Multi-Storey • More Expensive • Less Space What do you think is the key factor for a company in this choice?
    • 4. Private Benefit What the company gets for the action Car Park • Charge for its use • Encourage people to come to your shopping Centre / Attraction • Space for your employees to park • Stop people parking in the street
    • 5. External Costs (Negative Externalities) External costs are the costs to other people. The external cost in the car park’s case is the loss of the parkland and for local residents it might spoil their view.
    • 6. External Benefits (Positive Externalities) External benefits are benefits to people who are not involved in the business. It might stop park users from parking in residents driveways and along the road near their houses. Near Stowmarket Station
    • 7. Key Term Third Party Person not involved in decisions of the company. i.e. Not the business or the customer.
    • 8. McDonalds

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