Suppose That a Firm Is Located Along a River

question 110

Multiple Choice

Suppose that a firm is located along a river.The firm uses water from the river to cool its machinery and returns the water to the river several degrees warmer,which has led to a decline in the fish population downstream of the firm.
The damage to the downstream fish is a(n) :

• A)relevant cost of production.
• B)relevant cost of production only if the firm is charged a fine for the damage done.
• C)relevant cost of production only if there are commercial fishing activities downstream.
• D)implicit cost of production which the firm will take into account in determining profit maximizing output.

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Definitions:

Traffic Accidents

Incidents on the road where vehicles collide with each other, objects, or pedestrians, often resulting in damages or injuries.

Violent Crime

Criminal acts that involve the use of force or threat of force against others, such as homicide, assault, and robbery.

Sleep Patterns

The natural cycles of sleep stages, including REM and non-REM sleep, that occur through the night, impacting overall health and well-being.

Alcoholic Beverage

A drink that contains ethanol, commonly known as alcohol.