Externalities occur when the welfare of others not involved in the production or consumption of a good or service are affected in ways that markets don't take into account on their own.

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Zybrea Knight · Accepted Answer

Final Answer : True, Explanation :  This is the definition of externalities, which are a well-known market failure. Markets can only account for private costs and benefits, not external costs or benefits imposed on third parties.

Externalities occur when the welfare of others not involved in the production or consumption of a good or service are affected in ways that markets don't take into account on their own.

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