Which statement defines externality?

It is a change in demand brought about by factors other than price.

It is the external factors that cause a rise in the supply of goods or services.

It is the external factors that cause a decrease in the supply of goods or services.

It is the impact of production and consumption on unrelated third parties.

Question

Rory Larson

29 May, 07:29

+3

Answers (1)

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Mohammad Schmitt · Answer 1

Externalities are defined as the positive or negative consequences of economic activities on unrelated third parties.