Which of the following is a positive externality?
A) Sam dug a pond so he could go fishing, but the pond has contributed to an explosion of mosquitoes in your neighborhood.
B) Sam has dozens of cats, and they come into your yard to hunt the birds that come to your birdbath.
C) Sam buys a dilapidated house, renovates it, and increases the property values of all houses in the neighborhood.
D) Liquid waste from Sam's chicken farm flows into a neighbor's well water.

Question

Quizplus · Accepted Answer

Renovating a house and increasing property values in the neighborhood is a positive externality because it benefits others without them incurring any cost.

Which of the Following Is a Positive Externality