Question

External costs are those costs: Multiple Choice that fall directly on an economic decision maker. that fall indirectly on an economic decision maker. that are both social costs and private costs. that are imposed without compensation on someone other than the person who caused them.

Answer 1

Answer:

The correct option is D

Explanation:

External cost is the form of an expense which occur while consuming or producing the goods and services that imposes the cost or expense ( with negative effect) on the third party.

If there are the external costs while consuming the good, then the social costs would be greater than the private cost.

So, the external cost is defined as the cost that is imposed without any compensation on someone other than the person who cause or incur it.