Externalities are the unintended consequences or impacts of an economic activity that affect individuals or entities not directly involved in that activity.

Option 1 - Pollution of air by a cement factory: This is an example of a negative externality, as the pollution affects people and the environment outside the factory, resulting in negative impacts such as health problems and degraded air quality.

Option 2 - Health hazard caused by smoking by oneself: This option is NOT an example of an externality. When an individual chooses to smoke, the negative consequences primarily affect themselves, making it a personal choice rather than an externality.

Option 3 - Smoke coming out of a neighbor`s vehicle: This is an example of a negative externality, as the emissions from the neighbor`s vehicle can harm the surrounding environment and impact the health of nearby individuals.

Option 4 - Increase in land price due to construction of a road by the Government: This is an example of a positive externality, as the construction of a road by the government can increase the value of adjacent land, benefiting the landowners and potential investors.

Overall, while options 1, 3, and 4 are examples of externalities, option 2 is not an example as it does not involve impacts on individuals or entities outside of the