The Optimal Level of Pollution Occurs Where the Marginal Social

question 48

Multiple Choice

The optimal level of pollution occurs where the marginal social benefit is equal to

• A)marginal private cost, which equals marginal social cost plus marginal external cost
• B)marginal social cost, which equals marginal private cost plus marginal external cost
• C)marginal external cost, which equals marginal private cost plus marginal social cost
• D)marginal private cost, which equals marginal social cost plus marginal internal cost
• E)marginal social cost, which equals marginal private cost plus marginal internal cost

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Definitions:

Expected Value

A calculation in probability and statistics that shows what to predict as the outcome on average over many trials.

Investment

The allocation of resources, typically money, with the expectation of generating an income or profit.

Investment

The allocation of resources, such as time, money, or effort, in the expectation of generating a future return.

Expected Mean

The average value expected across a distribution based on probability calculations, often used in statistical analysis.