Money & WorkMental model
The cheapest price is often just the one someone else pays.
Externalities are costs or benefits that land on bystanders. A factory skips filters and residents get the dirt; the product's market price stays too low. Positive examples: vaccinations, education, a pretty front garden. Economists want such effects priced in, through carbon prices or subsidies, so that the price reflects true costs.
Useful: When something is suspiciously cheap, ask who's really paying the bill.
Source: de.wikipedia.org