Lead Used to Be Added to Petrol to Make the Engine

question 145

Essay

Lead used to be added to petrol to make the engine operate smoothly.Lead is also an atmospheric pollutant and it has been banned as an additive.Was there an economic justification for this ban by the government?

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Definitions:

Substitution Effect

The alteration in consumer behavior as a result of variations in the relative costs of products, driving consumers to shift from higher-priced items to those that are more affordable.

Increase In Price

occurs when the cost of goods or services rises, affecting consumer purchasing power and potentially leading to changes in supply and demand dynamics.

Income Effect

Variations in the income levels of an individual or the broader economy, and how these variations influence the demand for specific goods or services.

Purchasing Power

Purchasing power is the value of a currency expressed in terms of the amount of goods or services that one unit of money can buy.