What Happens When Society Requires That Firms Reduce Pollution

question 148

Multiple Choice

What happens when society requires that firms reduce pollution?

• A) There is a tradeoff because of reduced incomes to the firms' owners, workers, and customers.
• B) There is no tradeoff, since everyone benefits from reduced pollution.
• C) There is no tradeoff for society as a whole because the cost of reducing pollution falls only on the firms affected by the requirements.
• D) There is a tradeoff only if some firms are forced to close.

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Definitions:

Normal Balance

The side (debit or credit) where increases are recorded for a particular type of account, reflecting the account's normal balance position in the accounting equation.

Financial Statement

Papers that present a summary of a company's financial status, covering the balance sheet, income statement, and statement of cash flows.

Normal Balance

The side (debit or credit) of an account that is expected to have a higher balance, which is used to increase the account.

Normal Balance

The side (debit or credit) of an account that is expected to have a higher balance, based on the accounting equation.