An example of a positive externality is
A)pollution because it affects people not directly involved with producing it
B)a homeowner's maintenance of a beautiful lawn because this creates a benefit for neighbors
C)creating a monopoly
D)driving a car that emits pollution
E)cigarette smoking because this imposes an indirect cost on people around the smoker

Question

Quizplus · Accepted Answer

The homeowner's maintenance of a beautiful lawn creates a positive externality because it benefits neighbors who are not directly involved in maintaining the lawn. They may enjoy the view and increased property value without having to pay for the maintenance themselves.

An Example of a Positive Externality Is