When a firm or a consumer imposes an external cost on a third party not involved in the market transaction

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    they normally curtail the market activities to reduce the external costs.
     they must compensate the third party for the damages.
     they normally pay a higher market price to offset the external costs imposed.
     they have no incentive to account for the external cost imposed.
asked Jun 2, 2013 in Economics by anonymous
    

1 Answer

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they have no incentive to account for the external cost imposed.
answered Jun 3, 2013 by Xyz ~Expert~ (3,650 points)

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