The Efficient Level of Recycling Equates The

question 27

Multiple Choice

The efficient level of recycling equates the:

• A) marginal cost of scrap disposal to the marginal benefit from not using virgin materials.
• B) marginal cost of recycling to the marginal benefit from not using virgin materials.
• C) marginal cost of scrap disposal to the marginal cost of recycling.
• D) marginal private cost of disposal to the marginal cost of recycling.
• E) per-unit refund from recycled materials to the marginal benefit from not using virgin materials.

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Definitions:

Cost of Capital

The required return necessary to make a capital budgeting project, such as building a new plant, worthwhile.

Capital Rationing

In capital budgeting, the process of allocating available capital among projects to maximize total NPV.

IRR

The Internal Rate of Return; a discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.

Capital Constraints

Limitations on the amount of capital a company or economy can obtain, often leading to restrictions on growth and investment.