At Westonci.ca, we connect you with the best answers from a community of experienced and knowledgeable individuals. Discover reliable solutions to your questions from a wide network of experts on our comprehensive Q&A platform. Get immediate and reliable solutions to your questions from a community of experienced professionals on our platform.
Sagot :
Answer: What are externalities, and how do they affect who pays the true cost of a polluting factory?
Externalities are the market effects felt either beneficially or detrimentally by third parties in a market exchange. Another way to look at this is that externalities are by-products affecting bystanders. An example would be when a factory gets rid of production waste more cheaply by polluting a river than by disposing of the waste in a manner that does not affect the environment. By polluting the river, the factory has a lower internal cost of production, a lower price of output, and thereby a larger quantity demanded of its product. What is not in the final price of the product is the external cost of the pollution paid by those living downstream and suffering health costs and loss of income.
We hope our answers were helpful. Return anytime for more information and answers to any other questions you may have. Your visit means a lot to us. Don't hesitate to return for more reliable answers to any questions you may have. Westonci.ca is here to provide the answers you seek. Return often for more expert solutions.
