Question

Positive and negative of externalities

Answer 1

Answer:

A negative externality occurs when a cost spills over. A positive externality occurs when a benefit spills over. So, externalities occur when some of the costs or benefits of a transaction fall on someone other than the producer or the consumer.

Answer 2

Explanation:

An externality occurs when an economic action takes place and has an effect on people who are not directly part of the action. When an economic action takes place and other people are helped, it is a positive externality. When other people are harmed by the economic action, it is a negative externality.