When an individual buys a car in a congested urban area, it generates
A) a positive externality.
B) a positive technology spillover.
C) an efficient market outcome.
D) a negative externality.

Question

Quizplus · Accepted Answer

Buying a car in a congested urban area generates a negative externality because it adds to the existing congestion and pollution in the area, adversely affecting the well-being of other individuals living in the vicinity.

When an Individual Buys a Car in a Congested Urban