Use the Following to Answer Question

question 86

Multiple Choice

Use the following to answer question:
Figure: Efficiency and Pollution
-(Figure: Efficiency and Pollution) Use Figure: Efficiency and Pollution.Assume that firms are the only beneficiaries of pollution and that costs are borne solely by others in the society.If the government imposed an environmental standard that did NOT allow the quantity of pollution to exceed 40 tons,there would be:

• A)a socially optimal quantity of pollution.
• B)too little pollution because its marginal social benefit would exceed its marginal social cost.
• C)too much pollution because its marginal social cost would exceed its marginal social benefit.
• D)too much pollution because any pollution is too much from an economist's perspective.

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Definitions:

Income Statement

A financial statement that shows a company's revenues and expenses, and ultimately its profit or loss, over a specific period of time.

Earnings Performance

An evaluation of a company's profitability over a specific period, often analyzed through metrics like EPS (earnings per share).

Accounting Period

A specific period of time used for accounting purposes, during which financial statements are prepared.