Question

An example of an activity that creates a positive consumption externality is

A) logging, which pollutes rivers.
B) locating beehives next to an orange orchard.
C) smoking, which harms the health of a bystander.
D) a flu vaccination.
E) a noisy party.

Answer 1

An example of a positive consumption externality is locating beehives next to an orange orchard, where the bees' pollination benefits the orchard owner and the surrounding community by increasing the abundance and quality of oranges.

Step-by-step explanation:

An example of an activity that creates a positive consumption externality is locating beehives next to an orange orchard. When bees pollinate the orange trees, they not only benefit the orchard owner who gets a higher yield of fruit, but also the surrounding community. The bees' pollination can increase the abundance and quality of oranges, which can then be enjoyed by everyone in the area.