Question

Which of the following would most likely constitute a negative externality affecting free resources?

Groundwater pollution

Lower property taxes

Lower property values

New economic development

Answer 1

The answer is the first one, the Groundwater pollution.

Step-by-step explanation:

Externalities can be described as the consequences of economic activities on unrelated 3rd parties. In this scenario, Ground water pollution is the most suitable answer and also it is one of the most common-seen externalities in almost every country.

Ground water pollution mainly occurs due to manufacturing and industrial activities.