Which activity does NOT generate a negative externality?
A) Bob's Service Station dumps used oil in the river.
B) Bob renovates a rundown house in the neighbourhood.
C) Bob occasionally drives while drunk.
D) Bob's Service Station donates a car to charity.

Question

Quizplus · Accepted Answer

Donating a car to charity does not generate a negative externality because it has a positive impact on the community. The other options generate negative externalities - dumping used oil in the river (environmental pollution), driving while drunk (safety hazard), and renovating a rundown house (potentially increasing property values and pushing out lower-income residents).

Which Activity Does NOT Generate a Negative Externality