When the Environmental Protection Agency adopts regulations that force power plants to take into consideration the actual costs to deal with pollution and the health problems it causes, what type of market failure is the EPA addressing?

Question

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The EPA is addressing a negative externality, which is when the costs of a transaction or activity are borne by someone who is not a party to the transaction or activity. In this case, power plants are causing pollution and health problems that are not included in their costs, but are instead borne by individuals and society as a whole. By adopting regulations that force power plants to take these costs into consideration, the EPA is addressing this market failure.

When the Environmental Protection Agency Adopts Regulations That Force Power