Which of the following is NOT an example of a good with an external cost?
A) electricity generation producing carbon dioxide emissions that contribute toward global warming
B) logging that pollutes a nearby river
C) Jess smoking near her non-smoking roommate
D) Ahmed working at a bank and getting a flu shot each fall
E) noise pollution from aircraft

Question

Quizplus · Accepted Answer

Good with external cost refers to a good or service that creates a negative impact on an uninvolved third party. In this case, Ahmed getting a flu shot does not create any external cost on a third party. Therefore, option D is not an example of a good with an external cost. Options A, B, C, and E are all examples of goods with external costs as they create negative impacts on the environment, neighbors, and other people.

Which of the Following Is NOT an Example of a Good