Pollution is a negative externality.

Name: Pollution is a negative externality.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Pollution is a classic example of a negative externality, where the costs of production (in this case, environmental damage) are not fully borne by the producers but are instead shifted onto society as a whole. This leads to overproduction and an inefficient allocation of resources, as the market fails to reflect the true cost of production.

Pollution Is a Negative Externality