If Producing a Good or a Service Creates Pollution, Then

question 9

Multiple Choice

If producing a good or a service creates pollution, then

• A) the industry's supply curve includes the extra cost of pollution.
• B) at the unregulated, competitive market equilibrium quantity, marginal social benefit is less than the equilibrium price.
• C) at the unregulated, competitive market equilibrium quantity, marginal social benefit and marginal social cost are equal.
• D) at the unregulated, competitive market equilibrium quantity, marginal social cost is greater than the equilibrium price.
• E) an unregulated competitive market produces an efficient output.

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Definitions:

Useful Life

The expected period over which a fixed asset is projected to be usable by a company, affecting its depreciation or amortization schedules.

Maintenance and Repairs Expense

Costs incurred to keep property, plant, and equipment in operating condition and to fix unexpected breakdowns.

Closing Costs

These are fees and expenses, aside from the price of the property, paid by buyers and sellers when transferring ownership of a property.

Freight-In

The cost of transporting goods into a warehouse or to the buyer, which is typically included in the cost of goods sold.