Which of these is a negative externality that might be caused by a Canadian company carrying out large-scale strip mining, which is environmentally destructive, in Brazil?

A. Decline in the quality of Brazilian roadways

B. Increased competition among North American businesses

C. Decreased trust in North American businesses

D. Funding for education in Brazilian schools

A.

Explanation:

A negative externality is a cost that is suffered by a third party as a result of an economic transaction. A negative externality is a cost that is suffered by a third party as a result of an economic transaction. In a transaction, the producer and consumer are the first and second parties, and third parties include any individual, organisation, property owner, or resource that is indirectly affected. Externalities are also referred to as spill over effects, and a negative externality is also referred to as an external cost. Some externalities, like waste, arise from consumption while other externalities, like carbon emissions from factories, arise from production. In this case, the negative externality that might be caused by a Canadian company carrying out large-scale strip mining, which is environmentally destructive is the decline in the quality of Brazilian roadways that will be experienced by the community due to the trucks from the mine as well as the air polution.