Question

(1 of 6)
government can attempt to reallocate resources when negative or positive __________ (also called spillover benefits or costs) impact the economic system.

○ karma
○ internalaties
○ externalities
○ attitudes

Explanation:

In economics, externalities are the positive or negative spillover effects (benefits or costs) that affect third parties not involved in a transaction. "Karma" is a philosophical/religious concept, "internalaties" is not a recognized economic term, and "attitudes" relate to opinions, not economic spillovers. So the correct term is externalities.

Answer:

C. externalities