Questions: a. You build a chicken coop in your suburban backyard. You have several hens and one rooster. The rooster wakes up your neighbor each morning at 5:00 am. Your chicken coop creates a negative externality if your chickens do not lay eggs. creates a negative externality if the neighbor wants to sleep longer and a positive externality if the neighbor is happy to be awaken early each day. creates a positive externality if you sell your chickens' eggs at the local farmers' market. creates a positive externality if the neighbor wants to sleep longer but accepts free eggs in exchange for the inconvenience. b. You get sick and go to a doctor. The doctor diagnoses you with a bacterial infection and prescribes an antibiotic. Your visit to the doctor produces a positive externality if it prevents other people from getting sick and a negative externality if the bacterial infection becomes resistant to antibiotics. produces a negative externality if the doctor was hoping to leave early that day and a positive externality if the doctor was hoping to boost her income. produces a negative externality if you were supposed to be home studying for your classes. produces a positive externality if your medical insurance pays for the visit and a negative externality if you have to pay out of pocket. c. An urban farmer decides to build a bee hive to help pollinate the rooftop gardens in his neighborhood. The beehive generates a positive externality if the farmer creates a successful online business that sells products made from the bees' honey. generates a negative externality if the bees are killed by a colony of wasps. generates a positive externality if the rooftop gardens benefit from the pollination and a negative externality if the neighbors get stung by bees. generates a negative externality if the farmer spends nearly all his time tending the bees and rarely leaves his home.

a. You build a chicken coop in your suburban backyard. You have several hens and one rooster. The rooster wakes up your neighbor each morning at 5:00 am.

The answer is: creates a negative externality if the neighbor wants to sleep longer and a positive externality if the neighbor is happy to be awakened early each day.

This option is incorrect because the laying of eggs is not directly related to the externality caused by the rooster's crowing. The externality is about the noise affecting the neighbor, not the productivity of the chickens.

This option is correct. A negative externality occurs when the rooster's crowing disturbs the neighbor's sleep, while a positive externality occurs if the neighbor appreciates being awakened early.

This option is incorrect in the context of the rooster's crowing. Selling eggs is a separate activity and does not directly relate to the externality caused by the noise.

This option is incorrect because it describes a situation where a negative externality is mitigated by compensation, not a pure positive externality.

b. You get sick and go to a doctor. The doctor diagnoses you with a bacterial infection and prescribes an antibiotic.

The answer is: produces a positive externality if it prevents other people from getting sick and a negative externality if the bacterial infection becomes resistant to antibiotics.

This option is correct. Treating the infection can prevent its spread, benefiting others (positive externality), but overuse of antibiotics can lead to resistance, harming public health (negative externality).

This option is incorrect because it focuses on the doctor's personal schedule and income, which are not externalities affecting third parties.

This option is incorrect as it describes a personal consequence, not an externality affecting others.

This option is incorrect because it describes financial impacts on the individual, not externalities affecting others.

c. An urban farmer decides to build a bee hive to help pollinate the rooftop gardens in his neighborhood.

The answer is: generates a positive externality if the rooftop gardens benefit from the pollination and a negative externality if the neighbors get stung by bees.

This option is incorrect because the business success is a private benefit, not an externality affecting others.

This option is incorrect as it describes a loss to the farmer, not an externality affecting others.

This option is correct. The pollination benefits the gardens (positive externality), while bee stings can harm neighbors (negative externality).

This option is incorrect as it describes a personal consequence, not an externality affecting others.