How does cliff collapse have an effect on people's lives

Cliff collapse can cause land with houses, schools or places of work to be severely damaged or destroyed, this can result in people having to relocate which can cause express and sentimental distress (the impact of this is often greater on the elderly or families). Businesses that have been damaged / destroyed may have to close or make some people redundant if the economic impact on them was high; this has a large economic affect on the individual and any people dependent on them (e.g. Children / elderly parents) but this will also affect the entire community as there will be drops in the local economy which creates a multiplier affect.
Often coastal areas are tourism honeypot sites, if the cliff collapse causes lots of the sites tourists are interested in to be destroyed (e.g tourism shops, caravan sites) then lots of people employed in tourism may be may redundant, this has a wider affect than you may think (e.g. businesses that support this tourism such as companies that make scuba diving kit, dairies which provide milk for I've creams etc).

The answer is c) people evacuated but almost all returned