Which of the following is a benefit of internalizing a negative externality?

Question

Quizplus · Accepted Answer

When a negative externality is internalized, it means that the external cost is incorporated into the market price, resulting in a more efficient allocation of resources as the true cost of production is reflected. This leads to a reduction in the level of the negative externality, but not necessarily its complete elimination. The increase in efficiency can also lead to higher output, but this is not a guaranteed outcome. Lower prices may or may not result depending on the actual costs involved.

Which of the Following Is a Benefit of Internalizing a Negative