When Legislators Consider Passing Policies to Control Pollution, They Must

question 33

Multiple Choice

When legislators consider passing policies to control pollution, they must consider the potential economic impacts of the policies. The legislators are given the information shown in the figure.
-Assuming the legislators are considering the cost- effectiveness of the legislation and want to maximize net benefit,what level of pollution reduction would they most logically legislate?

• A)No reduction,since there is a cost to all levels of pollution reduction.
• B)60% reduction
• C)80% reduction
• D)90% reduction

---

Definitions:

Cyclical Dividend Policy

A dividend payment strategy by companies that varies depending on the economic cycle, with higher payouts during economic prosperity and lower or no dividends during downturns.

Economic Growth

An increase in the production and consumption of goods and services, indicating a country's economic health.

Manufacturing Firm

A business that produces goods through the use of labor, machines, tools, and chemical or biological processing or formulation.

Reverse Stock Split

A corporate action in which a company reduces the number of its outstanding shares to increase the share price, without changing the company's overall market capitalization.