Asked by
Triston Young-Dunn
on Dec 05, 2024
Verified
(Figure: MSB and MSC of Pollution) Use Figure: MSB and MSC of Pollution.Assume that firms are the only beneficiaries of pollution and that costs are borne solely by others in the society.If the current level of pollution is at Q1,_____ pollution is being emitted because _____.
A) not enough;MSB > MSC
B) not enough;MSB < MSC
C) too much;MSB > MSC
D) the socially optimal amount of;MSB = MSC
Marginal Social Benefit
The additional benefit society gains from consuming one more unit of a good or service.
Marginal Social Cost
The additional cost imposed on society as a whole by producing one extra unit of a good or service.
Pollution
The addition of pollutants to the natural surroundings, leading to harmful alterations.
- Understand the concept of externalities and how they impact social welfare.
- Review the contribution of public policies in dealing with external influences and realizing the social equilibrium.
Verified Answer
EG
Learning Objectives
- Understand the concept of externalities and how they impact social welfare.
- Review the contribution of public policies in dealing with external influences and realizing the social equilibrium.
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