External costs refer to the costs incurred by society as a whole that are not reflected in the private costs of production. These costs can include pollution, environmental degradation, and health impacts that are not factored into the price of a product or service. The difference between the social and private costs is known as the external cost.

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External Costs Are

Question 23

Multiple Choice

External costs are

A) Domestic economic impacts of foreign events.
B) The difference between social and private costs.
C) Outside costs that producers absorb.
D) Effects of government on the private sector.

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