An Externality Is Internalized

question 115

Multiple Choice

An externality is internalized

• A)when the person(s)or group that generated the externality incorporate into their own private cost-benefit calculations the external benefits (in the case of a positive externality)or the external costs (in the case of a negative externality)that third parties bear.
• B)when people are made aware of it and realize that social benefits are less than private benefits (in the case of a positive externality)and that social costs are less than private costs (in the case of a negative externality).
• C)when the person(s)or group that generated the externality do not incorporate into their own private cost-benefit calculations the external benefits (in the case of a positive externality)or the external costs (in the case of a negative externality)that third parties bear.
• D)it creates negative spillovers to society.

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