Explain the Differences Between External Costs,private Costs,and Social Costs and How

question 14

Essay

Explain the differences between external costs,private costs,and social costs and how the presence of external costs leads to market failure.

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Definitions:

Stress Response

The body's reaction to a challenge or demand, involving physiological changes such as increased heart rate and hormonal adjustments.

Homeostasis

The self-regulating process by which biological systems maintain stability while adjusting to conditions that are optimal for survival.

Blood-Brain Barrier

The blood-brain barrier is a selective semipermeable border that prevents most substances in the blood from entering the brain, thus protecting it from pathogens and toxins while allowing essential nutrients to pass through.

Cortisol

A steroid hormone in the body, often released in response to stress and used as a marker for stress levels.