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Question and answer: Perfect competition

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Interview: Applying economics at work

Understanding externalities

In this centrespread, David Horner outlines the different types of externalities

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Externalities are costs or benefits arising from a transaction that affects third parties — people or groups not involved in the original transaction. Externalities:

■ are either negative or positive for those affected

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Previous

Question and answer: Perfect competition

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Interview: Applying economics at work

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