Figure 158 Consider a Chemical Plant That Discharges Toxic Waste

question 167

Multiple Choice

Figure 15.8 Consider a chemical plant that discharges toxic waste into a nearby waterway.To reduce the emissions of toxic waste, the firm can install pollution abatement devices.Figure 15.8 shows the marginal benefit and the marginal cost from reduction the toxic waste emissions.
-Refer to Figure 15.8.Suppose the emissions reduction target is currently established at 8 million tons.Should society undertake to reduce an additional 1 million tons so that the total reduction is 9 million tons?

• A)No, because there is a net cost represented by the area B + C.
• B)Yes, because the marginal benefit exceeds the marginal costs.
• C)Yes, because toxic fumes are dangerous and must be eliminated at any cost.
• D)No, because the firms will pass the additional cost on to consumers.

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