Question

1. Vaccinations are a ________ good that create a ________ externality.

   		private; positive
   		public; positive
   		private; negative
   		public; negative

Answer 1

Ans) Public goods are both non rivalrous and non excludable in nature. That is, no one can be excluded from using it and ones usage does not reduce its availability for others.

Private goods are both excludable and rivalrous in nature.

Vaccination is a private good. Those who pay for it, get it.

Positive externality is when the bystander bears the benefit of any activity. When a person takes vaccine, not only that person but also the people around him/her are prevented from spread of that disease.

Option a (private, positive).