ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Traffic congestion is an example of a negative externality that occurs when too many drivers use a road at the same time. This creates long traffic jams, which can cause drivers to waste time and fuel and also lead to increased pollution as cars sit stationary in the same spot.

Detailed explanation-2: -Pollution is a negative externality. Economists illustrate the social costs of production with a demand and supply diagram. The social costs include the private costs of production incurred by the company and the external costs of pollution that are passed on to society.

Detailed explanation-3: -A negative externality is something that impacts a person or people who are uninvolved in a situation. For example, if you’re playing loud music while driving through your neighborhood late at night, you may wake up your neighbors. This can cause them to lose sleep, which might lead to negative health effects.

Detailed explanation-4: -Pollution is an example of a negative externality. Externalities that provide a benefit to others are “positive externalities.” Education, for example, generates positive externalities. Not all goods and services come with externalities, but many do-and some that do might be a surprise.