Respuesta :
The following economic concepts are matched with the scenarios they illustrate:
1. Substitution effect: The rising price of gold causes people to buy silver jewelry instead.
2. Income effect: When the price of chicken increases, families reduce their chicken intake substantially.
3. Positive externality: A new factory in a village provides livelihoods for the villagers.
4. Negative externality: A new factory in a village causes noise pollution.
Income effect causes an individual to adjust his or her consumption of a product due to an increase in its price.
- For example, an increase in the price of chicken causes families to reduce their chicken intake substantially.
In Economics, an externality is either be positive or negative depending on its effect on a third party.
A positive externality arises when the production of a finished product or service has a significant impact (benefits) on a third party that isn't directly involved in the process or transaction.
- For example, a new factory in a village provides livelihoods for the villagers.
A negative externality arises when the production of a finished product or service has a negative effect and impact (cost) on a third party.
- For example, a new factory in a village causes noise pollution.
Read more on negative externality here: https://brainly.com/question/1362529
Answer:
The rising price of gold causes people to buy
silver jewelry instead.-SUBSTITUTION EFFECT
When the price of gas increases, people
drive less.-INCOME EFFECT
A new factory in a village provides livelihoods
for the villagers.-POSITIVE EXTERNALITTY
A new factory in a village causes noise pollution-NEGATIVE EXTERNALITTY
Explanation:
This is the correct anwser
