Multinational Corporations Are Able to Prevent the Implementation of Policies

question 54

Multiple Choice

Multinational corporations are able to prevent the implementation of policies to address pollution because

• A) they threaten to shift production to nations with more lax regulations-so the air pollution will occur somewhere regardless of a single nation's laws against it
• B) there are no international treaties to discourage pollution
• C) they are able to produce goods to sell in any nation
• D) they already consider the cost of environmental remediation (fixing the problems that pollution causes) in their budgets

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Definitions:

Market Failures

Situations where the allocation of goods and services by a free market is not efficient, often justifying government intervention.

Overproduction

A situation where more goods are produced than can be sold, often leading to excess inventory and potential economic inefficiencies.

Producer Surplus

The difference between what producers are willing to accept for a good or service and the actual price they receive.

Market Price

The market price is the current price at which an asset or service can be bought or sold in a given market.