When the Marginal Costs of Pollution Abatement Equal the Marginal

question 124

Multiple Choice

When the marginal costs of pollution abatement equal the marginal benefits of pollution abatement,

• A)any further reductions in pollution will lower net social benefits.
• B)pollution has been entirely eliminated.
• C)any further reductions in pollution will continue to increase net social benefits.
• D)then firms are likely to increase output.
• E)then firms are likely to decrease output.

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Definitions:

Dollar Depreciates

A decrease in the value of the US dollar relative to other currencies, leading to higher prices for imports and cheaper exports.

Yen Appreciates

An increase in the value of the Japanese yen in comparison to another currency in the foreign exchange markets.

Net Exports

The value of a country's total exports minus its total imports, representing the external demand for a nation’s goods and services.

Positive Entry

The introduction of new firms into a market in response to observed profits, leading to increased competition.