To ensure all students are protected from getting the flu this year,your school offers free flu shots.What type of externality exists in this example?
A) negative consumption externality
B) positive consumption externality
C) positive production externality
D) negative production externality
E) neutral externality.

Question

Quizplus · Accepted Answer

This is a positive consumption externality because the free flu shots not only benefit the individual students who receive them but also reduce the spread of the flu to others. By getting vaccinated, students lower the chance of becoming sick and therefore reduce the chance of transmitting the disease to others, including those who may be more vulnerable to the flu, such as the elderly or young children. Therefore, the benefits extend beyond just the person receiving the shot, creating a positive externality.

To Ensure All Students Are Protected from Getting the Flu