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When There Is a Positive Externality in a Free Market

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When there is a positive externality in a free market, too much of the good is produced and consumed.


Definitions:

Expectations

Beliefs about what will happen in the future or about what one thinks should happen.

Key Managers

Individuals or teams critical in managing the operations and strategic direction of an organization.

Growth Rate

The rate at which a company or economy expands over a specific period, typically measured as a percentage.

Potential Difficulty

A possible challenge or obstacle that might arise during a process or activity.

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