Unintended costs that are imposed in third parties as a result of an economic activity are called:
A) marginal costs.
B) direct costs.
C) negative externalities.
D) positive externalities.
E) positive costs.

Question

Quizplus · Accepted Answer

Negative externalities are the unintended costs that are imposed on third parties as a result of an economic activity. These costs are not directly incorporated into the price of the product or service, and therefore affect individuals or groups who are not directly involved in the transaction. Examples of negative externalities include pollution, traffic congestion, and noise pollution.

Unintended Costs That Are Imposed in Third Parties as a Result