Multiple Choice
Which of the following is a benefit of importing goods and services in the context of externalities and social costs?
75
views
7. Externalities
Externalities: Social Benefits and Social Costs
Multiple Choice
Which of the following is a negative social consequence of Airbnb's property-sharing service that is not typically mentioned in standard economic texts?
A
Greater access to affordable short-term accommodation for travelers
B
Increased noise and disruption in residential neighborhoods
C
Improved utilization of underused housing resources
D
Enhanced cultural exchange between hosts and guests
Verified step by step guidance1
Step 1: Understand the concept of social consequences in economics, which include both positive and negative externalities—effects of a market activity on third parties not directly involved in the transaction.
Step 2: Identify the typical positive social consequences of Airbnb, such as greater access to affordable accommodation, improved utilization of underused housing, and enhanced cultural exchange, which are commonly discussed in economic texts.
Step 3: Recognize that negative social consequences are often external costs not reflected in the market price, such as increased noise, disruption, or other disturbances in residential neighborhoods where Airbnb operates.
Step 4: Analyze the options given and note that 'Increased noise and disruption in residential neighborhoods' represents a negative externality that is less frequently highlighted in standard economic discussions about Airbnb.
Step 5: Conclude that this negative social consequence is important to consider because it affects the well-being of local residents and is an example of a market failure where private benefits do not account for social costs.
Related Videos
Related Practice
