Which of the following is an example of a negative externality?
A)A person buys a car that is a lemon.
B)A worker is injured on the job.
C)A new restaurant's success causes another to go out of business.
D)A new hotel ruins the view of the ocean for a few homeowners.

Question

Quizplus · Accepted Answer

The new hotel's construction creates a negative effect on the homeowners who now have their view of the ocean obstructed. This is an example of a negative externality, where the actions of one party (the hotel construction) cause harm to another party (the homeowners) who are not involved in the transaction.

Which of the Following Is an Example of a Negative