Should the level of pollution be reduced to zero, and if not, then to what level?
What will be an ideal response?
No, the level of pollution should not be reduced to zero because the benefits of doing so may not justify the costs of doing so. Pollution should be reduced to the level where the polluting companies are internalizing the externality generated by pollution.
You might also like to view...
Refer to the market diagram. Of the surplus that the consumers lose because there is a monopoly (and not perfect competition), how much has become deadweight loss?
The following questions refer to the accompanying market diagram. PC and QC are the equilibrium price and quantity if the firm behaves competitively, and PM and QM are the equilibrium price and quantity if the firm is a simple monopoly.
a. Area E
b. Area H
c. Area E + H
d. Area C + D + H
A speculator who feels strongly that short rates will be falling over the next few years might want to be a __________ payer in a swap contract; if he is wrong there is __________ downside risk
A) fixed-rate; no B) fixed-rate; considerable C) floating-rate; no D) floating-rate; considerable
Refer to Figure 7-12 An increase in price from $30 to $35 would
a. increase total revenue by $250
b. decrease total revenue by $250.
c. increase total revenue by $500.
d. decrease total revenue by $500.
An increase in the growth rate of nominal GDP would be displayed in our model as:
A. a parallel shift of the AD curve outward. B. the AD curve becoming steeper. C. a parallel shift of the AD curve inward. D. the AD curve becoming flatter.