Question

1. (02.07 mc) which of the following might be a negative externality of introducing a soft drink in a developing country? (1 point) increased use of contaminated water increased health care costs lower sales of plastic and paper products increased local business competition

Explanation:

Negative externalities are costs imposed on third - parties not involved in a transaction. When a soft drink is introduced in a developing country, the production and consumption might lead to increased use of water in production processes and improper waste disposal of packaging, which can contaminate water sources. Local business competition is an internal market factor, lower sales of plastic and paper products is not a negative externality in this context, and increased health - care costs are more directly related to consumption rather than a typical externality like water contamination.

Answer:

Increased use of contaminated water