Why Do Negative Externalities Like Pollution Result in Inefficiency

question 100

Multiple Choice

Why do negative externalities like pollution result in inefficiency?

• A) Because producers artificially restrict their supply.
• B) Because producers ignore the external costs they impose on third-parties.
• C) Because producers manufacture more goods than people can afford to buy.
• D) Because producers will receive an unequal distribution of profits.

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Definitions:

Ammeter

An instrument used to measure the current in a circuit, usually in amperes.

Voltmeter

An instrument used for measuring electric potential difference between two points in an electric circuit.

Low-impedance

Refers to a circuit or device having a relatively low resistance to the flow of electrical current.

High Power Circuits

Electrical circuits designed to handle and manage high levels of electrical power, often used in industrial applications and power transmission.