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tb mc qu. 04-43 a negative externality or spillover... a negative externality or spillover cost occurs when multiple choice the total cost of producing a good exceeds the costs borne by the producer. the price of a good exceeds the marginal cost of producing it. firms fail to achieve productive efficiency. firms fail to achieve allocative efficiency.
A negative externality occurs when the production or consumption of a good imposes costs on third - parties not involved in the transaction. So the total cost of producing a good (including the external cost) exceeds the costs borne by the producer.
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the total cost of producing a good exceeds the costs borne by the producer.