If a production process creates pollution, a competitive market produces excessive pollution because
A) private marginal cost of pollution exceeds its social marginal cost.
B) social marginal cost of pollution exceeds its private marginal cost.
C) the marginal benefit of pollution to the firm is zero.
D) zero pollution is optimal.
B
You might also like to view...
In a fractional reserve banking system with no currency where res is the ratio of reserves to deposits, the money multiplier is
A) 1 - res. B) 1 + res. C) 1/res. D) res2
If people began to retire at a later age and there was an increase in the capital stock, real GDP growth would ____ and real GDP growth per capita would ____. a. increase; increase
b. increase; be indeterminate. c. decrease; decrease. d. decrease; be indeterminate
Given a downward sloping demand curve, a tax on the supply of a good will result in an increase in equilibrium price that is less than the amount of the tax.
Answer the following statement true (T) or false (F)
Which of the following industrial countries experienced a relatively slower growth of real GDP in the latter half of the 1990s?
a. Canada b. United States c. Italy d. France e. Japan