Explain whether each of the following is a positive or negative externality.

smoking on campus exposes students to secondhand smoke.

• college graduates add to the nation's supply of skilled workers and add to productivity.

• biotech firms invent new medicines.

• using energy-saving light bulbs reduces the pollution from electricity-generating plants.

• crowded freeways with heavy truck usage expose the surrounding communities to increased health risks.

• restoring the amazon forest can reduce global levels of pollution.

You are the owner of a local honda dealership. unlike other dealerships in the area, you take pride in your “no haggle” sales policy. last year, your dealership earned record profits of $1.5 million. however, according to the local chamber of commerce, your earnings were 10 percent less than either of your competitors. in your market, the price elasticity of demand for midsized honda automobiles is 4.5. in each of the last five years, your dealership has sold more midsized automobiles than any other honda dealership in the nation. this entitled your dealership to an additional 30 percent off the manufacturer’s suggested retail price (msrp) in each year. taking this into account, your marginal cost of a midsized automobile is $11,000. what price should you charge for a midsized automobile if you expect to maintain your record sales?