A negative externality:
A)is any cost above the economic cost.
B)equals the social cost plus the firm's private cost.
C)is an uncompensated cost imposed by an individual or firm on others.
D)equals the opportunity cost minus the social costs.

Question

Quizplus · Accepted Answer

A negative externality is an uncompensated cost imposed by an individual or firm on others. It is a cost that is not taken into account by the person or firm responsible for it, but instead is passed on to others. For example, pollution from a factory imposes costs on the surrounding community, such as health problems and reduced property values, without the factory paying for these costs.

A Negative Externality