True or False: The presence of negative externalities always leads to higher prices for consumers and guarantees that all social costs are accounted for in market transactions.

The statement is false. Negative externalities occur when a product or activity causes harm to others who are not directly involved, like pollution from a factory that affects nearby residents. Because these social costs are not included in the price of the product, consumers may not pay the full cost of their purchase, leading to lower prices than if all costs were accounted for. For example, if a company pollutes a river, it might save money on waste disposal, making its products cheaper, but the community bears the cost of health issues and environmental damage. Therefore, negative externalities can lead to lower prices for consumers and do not guarantee that all social costs are considered in market transactions.