Example of an externality


Question: Which of the following is NOT an example of an externality? Explain why the other examples are externalities and why the one you selected is not.

- government tax imposed on smog

- noise from a barking dog

- the loss of an ocean view because of new construction

- improved property values when a rundown house is remodeled

- groundwater pollution from an industrial facility

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Microeconomics: Example of an externality
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