Externalities and Spillovers · seed 1 · A4, ink-friendly. The answer key prints on its own page for grown-ups.

When Your Choices Touch Other People

Civics & Economics · Economics · ages 10-13
Name ______________________   Date ____________
  1. Which of these is a HELPFUL spillover?

    • Litter left behind at the park
    • A neighbor's flower garden that brightens the whole street
    • Loud music blasting late at night
  2. A family throws a loud party that goes past midnight. Who is affected by the noise, even though they never chose to have a party?

    • Only the family hosting the party
    • The neighbors trying to sleep nearby
    • No one, since parties happen indoors
  3. A spillover only affects the person who made the choice.

    Circle one:   True   False

  4. A beekeeper's bees fly to nearby farms and pollinate their crops for free. Is this spillover helpful or harmful to the farms?

    • Helpful, the crops grow better because of the bees
    • Harmful, the bees damage the crops
    • Neither, the bees never reach the farms
  5. Litter keeps piling up at a public park because nobody who drops it pays any price for it. Which of these would best handle the problem?

    • A fine for littering in the park
    • Removing every trash can so people take litter home
    • Posting a sign that says 'please don't litter' with no consequence
  6. A factory near a school releases thick smoke every day. Who breathes that smoke, even though they never agreed to it?

    • Only the factory's own workers inside the building
    • The students and teachers at the nearby school
    • Nobody, because smoke rises above the school
  7. A new law makes factories pay money for every ton of smoke they release. Why might this reduce pollution, even though the tax doesn't clean the river by itself?

    • It forces every factory to close immediately
    • It has no effect, since the pollution already happened
    • It gives the factory a real cost for the harm, so cutting pollution now saves the factory money
  8. Mia says, 'A vaccination only helps the person who gets the shot, so it isn't a spillover.' What is wrong with her thinking?

    • She's right, vaccines only ever help the person who gets the shot
    • A vaccinated person is less likely to spread the disease, which protects other people too
    • Vaccines are actually a harmful spillover
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Answer key

For grown-ups. Fold this page away before handing over the rest.

When Your Choices Touch Other People W1-mt_F4SQsGpZk9-s1

  1. A neighbor's flower garden that brightens the whole street · The garden makes things better for people who never planted it. That is a helpful spillover.
  2. The neighbors trying to sleep nearby · The neighbors never agreed to a loud night, but they hear it anyway. That makes them the third party.
  3. False · A spillover is the opposite: it reaches people who had no say in the choice at all.
  4. Helpful, the crops grow better because of the bees · The farms benefit from something they never paid for or asked for. That makes it a helpful spillover.
  5. A fine for littering in the park · A fine attaches a real cost to littering, so people who cause the harm start to feel it.
  6. The students and teachers at the nearby school · The school never chose to be near polluted air, but the students and teachers breathe it anyway.
  7. It gives the factory a real cost for the harm, so cutting pollution now saves the factory money · Once pollution costs the factory money, the factory has a reason to make less of it. That connects the harm back to the choice that caused it.
  8. A vaccinated person is less likely to spread the disease, which protects other people too · Fewer sick people means the disease spreads less to others, so people around a vaccinated person benefit too, even though they never got the shot themselves.
Worksheet · LightMySky