One way that government can encourage the production of goods or services that have external benefits is to subsidize the good or service.

Name: One way that government can encourage the production of goods or services that have external benefits is to subsidize the good or service.
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Question

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Subsidies lower the cost of production, encouraging producers to supply more of the good or service, thus increasing its availability and consumption, which can enhance external benefits.

One Way That Government Can Encourage the Production of Goods