The Allocatively Efficient Amount of Pollution Prevention Would Occur When

question 28

Multiple Choice

The allocatively efficient amount of pollution prevention would occur when

• A) the total social benefits of pollution prevention equals the total social costs of pollution prevention
• B) the total social costs of pollution prevention are minimized
• C) the marginal social benefits of pollution prevention equals the marginal social costs of pollution prevention
• D) none of the above

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Definitions:

Spreadsheet

A digital document that allows users to organize, analyze, and store data in rows and columns.

Discount Rate

Discount rate is the interest rate used in discounted cash flow analysis to determine the present value of future cash flows.

Net Present Value

A financial metric that calculates the present value of all cash inflows and outflows from a project or investment, taking into account the time value of money.

Internal Rate of Return

The discount rate that makes the net present value of all cash flows from a particular project equal to zero.