Economics 0455 · IGCSE · Market failure

Market failure — practice question

A government plans to construct a new international airport in a region of outstanding natural beauty. What would be one external cost of this decision?

  • Athe cost of importing construction materials
  • Bthe enjoyment lost by those unable to use the countryside
  • Cthe increase in profits for local businesses
  • Dthe wages paid to the construction workers

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