Answer:
Your neighbor paints her house a hideous color.
Trash dumped upstream flows downstream right past your house.
Explanation:
Externality can be of two types i.e either positive or negavtive.
Negative externality: The term negative externality refers to the process in which a particular cost is being suffered due to the presence of a third party as a result of a specific economic transaction. In any of the transactions, the consumer and the producer are considered to be second and first parties and therefore any organization, resource, and individual, etc are considered as the third parties that get affected indirectly.
An example of a negative externality is Cigarettes.
