Recently, the State of Tennessee Discovered Chemical Compounds in Their

Recently, the State of Tennessee discovered chemical compounds in their drinking water which may cause cancer. Since Tennessee's drinking water comes from the Pigeon River in North Carolina, the source of these chemicals is the waste discharges of industrial paper plants in North Carolina. This is an example of a(n) :

A) external cost imposed on the citizens of Tennessee by the industrial plants of North Carolina.
B) market failure where the market price of the output of these industrial plants does not fully reflect the social cost of producing these goods.
C) externality where the marginal social costs of producing these industrial goods differ from the marginal private costs.
D) all of these.