Question

question 13
what is a spillover?
another term for an externality.
a situation where firms reduce pollution charges.
the tax imposed on the additional units of output produced.
the measurable cost of command - and - control regulations.
the costs firms pay to trade pollution permits.

Explanation:

In economics, a spillover is indeed another term for an externality. An externality occurs when a third - party is affected (either positively or negatively) by an economic transaction that they are not directly part of. For example, pollution from a factory (a negative externality) affects the health of nearby residents (the third - party).

• The option "A situation where firms reduce pollution charges" is incorrect. Reducing pollution charges is a policy or firm - level action, not the definition of a spillover.
• "The tax imposed on the additional units of output produced" is a description of a specific tax (like a marginal tax on output), not a spillover.
• "The measurable cost of command - and - control regulations" is about the cost of regulations, not the concept of a spillover.
• "The costs firms pay to trade pollution permits" is related to the cost of participating in a pollution - permit trading system, not a spillover.

Answer:

Another term for an externality.