Question

9. What are Externalities?​

Answer 1

Answer:

An externality is a cost or benefit caused by a producer that is not financially incurred or received by that producer.An externality can be both positive or negative and can stem from either the production of a good or service.

Explanation:

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Answer 2

An externality is a cost or benefit caused by a producer that is not financially incurred or received by that producer. An externality can be both positive or negative and can stem from either the production or consumption of a good or service. The costs and benefits can be both private—to an individual or an organization—or social, meaning it can affect society as a whole.

Externalities by nature are generally environmental, such as natural resources or public health. For example, a negative externality is a business that causes pollution that diminishes the property values or health of people in the surrounding area. A positive externality includes actions that reduce transmission of disease or avoids the use of lawn treatments that runoff to rivers and thus contribute to excess plant growth in lakes. Externalities are different from donations of parkland or open-source software.