Economic Analysis of Social Issues 1st Edition by Alan Grant

Exercise 21

John lives in a second-floor apartment in Missoula, Montan a. An elderly resident who prefers a very warm apart1nent lives directly beneath him. As a result, John rarely has to run tl1e heat in his own apartment. The heat John receives from his downstairs neighbor could be considered a _________.
A) Transactions cost
B) Positive externality
C) Negative externality
D) Property right