When a factory pollutes a river, the costs and losses that affect people downstream would be called ______ costs.

Name: When a factory pollutes a river, the costs and losses that affect people downstream would be called ______ costs.
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Question

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External costs are those costs that are not borne by the parties directly involved in an economic transaction. In this case, the factory's pollution affects people downstream who are not part of the factory's operations, making it an external cost.

When a Factory Pollutes a River, the Costs and Losses