Which of the Following Is True of Externalities

Multiple Choice

Which of the following is true of externalities?

A) Positive externalities arise when an economic activity imposes costs on others who are not directly involved in the activity.
B) Negative externalities can be internalized by offering subsidies to the agents who generate such externalities.
C) Like public goods,externalities always result in a free rider problem.
D) Externalities may arise from either production or consumption of a good or service.