External Cost ■ Scenario Steel plant dumping waste in a river o The entire steel market effluent can be reduced by lowering output(fixed proportions production function) Chapter 18 Slide 5Chapter 18 Slide 5 External Cost ◼ Scenario ⚫ Steel plant dumping waste in a river ⚫ The entire steel market effluent can be reduced by lowering output (fixed proportions production function)