External costs as negative externalities Steps:

• Define external cost: a negative impact on third parties not reflected in the producer's price.
• Analyze the airport project: building in a natural area harms public access and enjoyment without compensation.
• Evaluate options: seek costs borne by society, not the government or direct participants.
• Select B: it captures uncompensated loss to the community.

Why B is correct:

• External costs, per economic definition, include negative externalities like environmental degradation reducing public welfare, such as lost countryside enjoyment.

Why the others are wrong:

• A: Internal cost to the project, paid directly by the government.
• C: Positive externality benefiting locals, not a cost.
• D: Internal labor cost absorbed by the project budget.

Final answer: B