Final answer:
When companies take into account an externality and want to supply more at any given price, it indicates they have addressed a positive externality.
Step-by-step explanation:
If companies, when accounting for an externality, aim to supply more at any given price compared to the original supply, it suggests the presence of a positive externality. A positive externality occurs when the production or consumption of a good or service generates benefits for third parties beyond those directly involved in the transaction. For example, consider a company that invests in research and development to improve the production process. As a result, the company not only enhances its own productivity but also contributes to technological advancements that benefit the industry as a whole. The positive spillover effects create additional value for society beyond what is reflected in the company's private costs and revenues. In response to this positive externality, the company may choose to supply more at any given price. This decision aligns with the recognition that the societal benefits extend beyond the firm's individual gains. By increasing supply, the company contributes to the broader positive impact, promoting economic efficiency and social welfare. Addressing positive externalities often involves policy considerations, such as government incentives, subsidies, or public-private partnerships, to encourage firms to internalize the societal benefits in their production decisions. This approach aligns private incentives with social goals, fostering a more efficient and equitable outcome.