Economics 9708 · AS & A Level · 7.4

7.4 — practice question

Give one example of a negative externality.

  • Athe non-provision of public goods by the market
  • Bindirect taxation that fails to internalise the external cost
  • Cmonopoly power leading to reduced output and a higher price
  • Dthe production of a good that has a harmful effect on a third party

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