An external benefit is a:
A)negative externality.
B)benefit that accrues to domestic firms as a result of the actions of foreign (external)firms.
C)benefit that accrues to foreign (external)firms as a result of the actions of domestic firms.
D)benefit that individuals or firms confer on others without receiving compensation.

Question

Quizplus · Accepted Answer

An external benefit occurs when individuals or firms provide benefits to others without receiving compensation. It is a type of positive externality, which refers to the benefits that accrue to third parties as a result of the actions of others. A classic example of an external benefit is education, which can lead to better-informed citizens and a more productive workforce, benefitting society as a whole.

An External Benefit Is A