Give an Example Where a Government Subsidy Can Correct an Externality

question 8

Essay

Give an example where a government subsidy can correct an externality. Explain how the subsidy would lead to a more efficient outcome.

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Definitions:

Unethical Sales Behaviour

Practices in sales that are deceptive, dishonest, or otherwise violate moral principles.

Ethical Misconduct

Behaviors or actions by individuals or organizations that violate moral or professional ethics standards.

Abusive Behaviour

Actions that intentionally cause harm or distress to another person, often used in the context of relationships or workplaces.

Bounded Ethicality

The concept that cognitive biases and organizational pressures lead individuals to engage in actions that are unethical without fully realizing their wrongdoing.