If the marginal social benefit received from pollution is equal to its marginal social cost:
A)society's well-being can be improved if the quantity of pollution increases.
B)society's well-being can be improved if the quantity of pollution decreases.
C)society has achieved its socially optimal level of pollution.
D)the market is producing too much pollution.

Question

Quizplus · Accepted Answer

When the marginal social benefit is equal to marginal social cost, society has reached its socially optimal level of pollution. This means that any further reduction in pollution would cost more than the benefits it would generate, while any increase in pollution would generate more costs than benefits. Therefore, society should maintain the current level of pollution to maximize well-being.

If the Marginal Social Benefit Received from Pollution Is Equal