Excluding the external costs from the prices of goods and services

Question

Quizplus · Accepted Answer

Excluding the external costs from the prices of goods and services hides these costs from the consumer, hinders the development of green goods and services, and promotes pollution and resource waste. When the prices of products or services do not reflect their true environmental, health, or social costs, it creates incentives for producers and consumers to continue unsustainable practices that damage the environment and harm communities. Only by internalizing these costs into the prices can markets work more efficiently and promote sustainability.

Excluding the External Costs from the Prices of Goods and Services