Q1 Externality :Show real-life examples of both positive and negative externality (one example for each case will be good enough), and also explain the reason for your example.
Q2. (Retailers Sales Effort)In reality sometimes it is difficult to induce the retailers to make more or better sales effort. For instance, a car maker may find that its local dealers are reluctant to spend advertising money to promote its new car model.
(1) List the main reasons that may prevent the retailers from making more sales effort.
(2) Give each reason you listed in (1) a convincing and detailed explanation.
(3) For each reason you listed in (1), provide one practical solution and also explain why your solution works.
Explanation & Answer:
Retailers Sales Effort
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