Figure 10-9

question 279

Multiple Choice

Figure 10-9
-Refer to Figure 10-9, Panel (b) and Panel (c) . The installation of a scrubber in a smokestack reduces the emission of harmful chemicals from the smokestack. Therefore, a government policy that internalized the externality would move the quantity of smokestack scrubbers installed from point

• A)Q2 to point Q3.
• B)Q3 to point Q2.
• C)Q4 to point Q5.
• D)Q5 to point Q4.

---

Definitions:

Direct Materials

Raw materials that can be directly identified and easily traced to the manufacturing of a product.

Indirect Material

Materials used in the support of the production process but not directly a part of the finished product.

Period Cost

Costs that are expensed in the period in which they are incurred, not directly tied to the production of goods or services.

Goals Met

A term indicating the achievement of predefined objectives or targets.