Which of the following is an example of a negative externality?
A) A Japanese company exports cars to the U.S., which causes American workers to lose their jobs.
B) An employee of a chemical company spills acid on his arm, causing severe damage.
C) John plants fruit trees in his front yard, which attracts bees, which sting neighbor Mary.
D) Sally buys coffee at McDonald's, spills some and burns her hand.
E) Jack attempts to fix his roof, falls off, and breaks his leg.

Question

Quizplus · Accepted Answer

Negative externalality occurs when an action by one party results in negative effects on another party that was not involved in the decision. In choice C, John's decision to plant fruit trees results in bees stinging his neighbor Mary, a negative effect on Mary who was not involved in John's decision.

Which of the Following Is an Example of a Negative