Goods that have spillover costs are overproduced because

Question

Quizplus · Accepted Answer

Businesses prioritize profits over minimizing externalities or spillover costs, which leads to overproduction of goods with spillover costs. It is not solely the responsibility of the government to manage externalities, but businesses also have a role to play in reducing negative impacts on the environment and society. While government regulation and enforcement can help mitigate the issue, it is not solely a failure of government action that leads to overproduction of goods with spillover costs.

Goods That Have Spillover Costs Are Overproduced Because