-In the Above Figure, If a Firm Is Cleaning Up

question 233

Multiple Choice

-In the above figure, if a firm is cleaning up Q2 units of pollution, it is an

• A) efficient solution, because marginal social benefits are greater than marginal social costs.
• B) efficient solution, because marginal social benefits are equal to marginal social costs.
• C) inefficient solution, because marginal social benefits are greater than marginal social costs.
• D) inefficient solution, because marginal social costs are greater than marginal social benefits.

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Definitions:

Taxpayers

Individuals or entities that are obligated to make payments to governmental authorities, typically in the form of taxes.

Flooding

An overflow of water onto land that is normally dry, often caused by heavy rain, melting snow, or breach in water containment structures, leading to potential damage to property and risks to health.

Barter Economy

An economic system where goods and services are exchanged directly for other goods and services without the use of money as a medium of exchange.