Laws that restrict the smoking of cigarettes in public places are examples of government intervention that is intended to reduce a

Marketing Dec 25, 2020

Laws that restrict the smoking of cigarettes in public places are examples of government intervention that is intended to reduce

a. the influence of the invisible hand.

b. trade.

c. externalities.

d. market power.

Expert Solution

Laws that restrict the smoking of cigarettes in public places are examples of government intervention that is intended to reduce c. externalities.

Cigarette smoke is a negative externality. That means that the person who is subjected to secondhand smoke is being harmed through no fault of their own. The government steps in and tries to correct the harm by making a law restricting smoking in public.

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