Task 1: Consider the following list of goods. For each good, explain the followi

Question

Task 1: Consider the following list of goods. For each good, explain the following points.

Are there any externalities associated with this good?
Explain whether the private market should provide this good or the government should provide this good. Explain in terms of whether the characteristics of the good would make it difficult to be provided by the private market or the government.

List of Goods:
A. A cup of coffee at a coffee shop
B. City fire protection
C. Polar bears in the Arctic
D. Clean air

Explanation / Answer

A. A cup of coffee at a coffee shop There are externities Its a private good as government cant feel the need to produce it as not necessary. B. City fire protection There are no externities public good as related to public C. Polar bears in the Arctic No, there are no externities public good as private will harm it D. Clean air No, there are no externities public good as private will harm it

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