Asked by Jenna Mastellone on Sep 29, 2024

What is the greatest impact of internalizing external costs? 

A)  Internalizing external costs would make pollution more profitable. 
B)  Fuel inefficient cars would still have competitive prices if their external costs were internalized. 
C)  Internalizing external costs would make consumers more aware of the true cost of goods. 
D)  Real market prices would always be cheaper if external costs were internalized.

Internalizing External Costs

The process of ensuring that the prices of goods and services reflect the true costs associated with their consumption or production, including environmental impacts.

Pollution

The introduction of harmful substances or products into the environment, resulting in negative effects on life and health.

Real Market Prices

The actual selling price of goods and services in the market, reflecting supply, and demand without distortion by subsidies or taxes.

  • Comprehend the external and internal costs incurred by economic activities and their effects on sustainability and policy development.