Question

an externality is
a. a cost paid for by the producer of a good or service.
b. anything that is external or not relevant to the production of a good or service.
c. a benefit or cost experienced by someone who is not a producer or consumer of a good or service.
d. a benefit realized by the purchaser of a good or service.

Explanation:

An externality is a benefit or cost that affects a third - party who is not involved in the production or consumption of a good or service. Option A refers to a producer's cost, not an externality. Option B is not the correct definition. Option D is about the benefit to the purchaser, not an externality.

Answer:

C. a benefit or cost experienced by someone who is not a producer or consumer of a good or service.