What do you observe?
Use marginal analysis (i.e., marginal social benefit (MSB) and marginal social cost (MSC)) to graphically illustrate a Superfund site abatement decision that is solely risk-based relative to one that is based on the efficiency criterion. What do you observe?Use marginal analysis (i.e., marginal social benefit (MSB) and marginal social cost (MSC)) to graphically illustrate a Superfund site abatement decision that is solely risk-based relative to one that is based on the efficiency criterion.
Using marginal analysis, the graph below illustrates a risk-based Superfund site abatement level at point AB, where MSB equals zero. This corresponds to the point where TSB are maximized with no consideration for costs. Notice that this abatement level is markedly higher than an efficient abatement level at point AE, where MSB equals MSC. Hence, the model shows that risk-based decisions result in overregulation.
You might also like to view...
The tax multiplier is the
A) magnification effect of a change in taxes on aggregate supply. B) magnification effect of a change in taxes on the national debt. C) magnification effect of a change in taxes on the budget deficit. D) magnification effect of a change in taxes on government expenditures. E) magnification effect of a change in taxes on aggregate demand.
Suppose a men's suit produced in Moldavia sells for 250 euros. If the exchange rate between euros and dollars is €1 = $1.38, how much will an American pay for the suit?
A. $250.00. B. $345.00. C. $181.16. D. $138.00.
We temporarily operated outside the production possibilities frontier for at least two years in which one of the following decades?
A. The 1930s B. The 1940s C. The 1970s D. The 1980s
If Country X has a higher labor productivity than the rest of the world in the production of a good, then Country X has a comparative advantage in the production of the good.
Answer the following statement true (T) or false (F)