1)If smoking generates external costs, should smoking simply be outlawed? How about cars that pollute?

2)Is the Democratic Republic of the Congo a third-world country?

3)Damage to the environment occurs because: a) most businesses just don't care about the environment. b) consumers want goods and services at the lowest prices, no matter what other costs may be involved. c) in the process of obtaining goods and services we enjoy, pollution occurs. d) pollution occurs naturally, with or without human activity.

1)There are ways the government can use to reduce the external costs generated by smoking and cars. For example, the government can increase the tax on cigarettes to make them expensive. At a higher price, the level of smoking will reduce. Moreover, the government can prohibit the advertisement of cigarettes on television and instruct tobacco companies to have health cautions on cigarettes packages to scale back the demand for tobacco products.

On car pollution, the government can increase the gasoline tax. High gasoline tax will reduce congestion by encouraging individuals to make use of public transport, reside closer to work and even carpool. With fewer vehicles on the roads, the amount of pollution from automobiles will decline.

2)

The term "third-world country" is technically a relic of the Cold War era, where it was used to describe countries that were politically aligned with neither the United States (the "first-world" countries) or the Soviet Union (the "second-world" countries). Under this criteria, the Democratic Republic of the Congo (which was called "Zaire" for much of the Cold War) was indeed a third-world country, since it was not officially aligned with either global superpower.

However, the term "third-world country" has come to refer to countries that suffer from extreme poverty and low human development. Under this criteria, the term "developing country" is more appropriate, based upon a country's score on the United Nation's Human Development Index (HDI). According to HDI findings, the DRC is indeed a developing country, as it has one of the lowest rates of human development in the world. According to the 2016 HDI rankings of countries, the DRC has an HDI score of only 0.435, ranking it 176 out of 188 countries in terms of development (for comparison, the highest-ranking country, Norway, has a 2016 HDI score of 0.949).

3)

The answer to this question is c) in the process of obtaining goods and services we enjoy, pollution occurs.

This situation is described by the term negative externality. Negative externality takes place when an individual or a firm participates in an activity that deteriorates the welfare of the third party but does not pay for the damage caused. For example, when driving, exhaust from automobiles pollutes the environment resulting in a negative externality.