Question

question 11 (1 point)
when a beekeeper places his hives of bees in an orchard so that the bees can gather nectar to produce honey, the bees pollinate the orchard, which increases the yield of fruit. what is the economic explanation of this activity?
it creates a negative externality because one party may benefit from it but the other party may suffer a loss.
it creates a positive externality because both parties can benefit from this activity.
it creates a positive externality because orchard owners can charge the beekeeper a fee for the use of his orchard.
it creates a negative externality because the bees are a hazard to the orchard owner.

Explanation:

A positive externality occurs when a third - party benefits from an economic transaction or activity. In this case, the beekeeper's activity of placing bees in the orchard (to gather nectar for honey production) has an additional positive effect of pollinating the orchard, which increases the fruit yield (a benefit for the orchard owner). The first option about negative externality is wrong as there is no loss mentioned. The third option about charging a fee is not the core economic explanation of the positive externality. The fourth option about bees being a hazard is incorrect as the bees' pollination is beneficial.

Answer:

It creates a positive externality because both parties can benefit from this activity.