📚 Learning Guide
Negative Externalities in Consumption
easy

What is the underlying cause of the cleanup costs incurred by neighbors due to homeowners planting trees?

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Choose the Best Answer

A

The trees provide shade that reduces energy costs for neighbors

B

The fallen leaves from the trees create additional waste for neighbors to manage

C

Neighbors enjoy the aesthetic benefits of the trees in their vicinity

D

Homeowners are incentivized to plant more trees due to government subsidies

Understanding the Answer

Let's break down why this is correct

Answer

When homeowners plant trees, it can create a situation called a negative externality, which means that their actions affect others in ways that are not reflected in the cost of planting those trees. For example, if a homeowner plants a large tree that eventually grows over into a neighbor's yard, it can block sunlight or even drop leaves and branches, creating extra cleanup work for the neighbor. This means the neighbor has to spend time and possibly money to deal with the mess caused by someone else's decision to plant the tree. The underlying cause of the cleanup costs is that the homeowner does not consider how their trees might negatively impact their neighbors, leading to an unfair burden on those neighbors. Therefore, it's important for homeowners to think about the effects of their choices on others in their community.

Detailed Explanation

When homeowners plant trees, they drop leaves. Other options are incorrect because Some might think shade from trees helps neighbors save on energy bills; People may believe that neighbors enjoy the beauty of trees.

Key Concepts

Negative Externalities in Consumption
Market Failures
Government Interventions
Topic

Negative Externalities in Consumption

Difficulty

easy level question

Cognitive Level

understand

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