Which of the following is an example of an external cost?
A) a grove of trees planted in a park in Seattle
B) a library built in Philadelphia
C) a new, faster computer chip
D) an oil spill off the coast of South America
E) a student graduating from college

Question

Quizplus · Accepted Answer

An oil spill off the coast of South America is an example of an external cost because it imposes a negative impact on the environment and potentially on the local economy and community. The cost of cleanup and restoration may also have to be borne by parties other than the oil company responsible for the spill.

Which of the Following Is an Example of an External