Requiring deposits on soft drink containers is an example of using the price system to eliminate an external diseconomy because
A) consumers prefer throwaway cans.
B) it shifts pollution costs from individuals to society.
C) it makes the drinker pay for the disposal costs of the can.
D) the deposit allows the financing of trash baskets.
E) the private costs exceed the social costs.

Question

Quizplus · Accepted Answer

Requiring deposits on soft drink containers makes the drinker pay for the disposal costs of the can, which helps eliminate the external diseconomy of pollution caused by discarded containers. This way, the private costs, which include the deposit fee, exceed the social costs of pollution caused by the disposal of the can.

Requiring Deposits on Soft Drink Containers Is an Example of Using