The Efficient Amount of Pollution Control Is

question 5

Multiple Choice

The efficient amount of pollution control is:

• A) the amount for which the total social benefit equals the total social cost of pollution.
• B) the amount for which the marginal social benefit equals the marginal social cost of pollution.
• C) always zero.
• D) always a 100 percent abatement.

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Definitions:

Long Run

A period of time in which all factors of production and costs are variable, allowing firms to adjust all inputs in response to market changes.

Inputs

Inputs are the resources such as labor, materials, and capital that are used in the production process to create goods and services.

Industry Entry

The process by which a new competitor or business enters into an industry, facing various barriers such as high startup costs, regulatory requirements, and competition.

Short Run

A period of time during which at least one of a firm's inputs is fixed and cannot be changed.