Suppose that large-scale pork production has the potential to create ground water pollution. Why might this type of pollution be considered an externality?
A)The groundwater pollution reduces the cost of large-scale pork production.
B)The economic impact of a large-scale pork production facility is localized in a small geographic area.
C)The pollution has the potential for creating a health risk for water users in the region surrounding the pork production facility.
D)Consumers will not reap the benefits of lower production cost from large-scale pork production.

Question

Quizplus · Accepted Answer

Groundwater pollution from pork production is an externality because it imposes a cost (health risk) on third parties (water users) who are not involved in the production or consumption of pork.

Suppose That Large-Scale Pork Production Has the Potential to Create