Which of the following is true in regard to the optimal level of pollution?
A) What is cheapest for private firms would not be cheapest for society as a whole.
B) With respect to the damage costs there will be a divergence between private and
social costs.
C) In general, the tendency is for private firms to totally ignore the damage costs.
D) In most instances, the economic optimum is associated with a positive level of
pollution emission.
E) All of the above are true.

Question

Which of the following is true in regard to the optimal level of pollution?
A) What is cheapest for private firms would not be cheapest for society as a whole.
B) With respect to the damage costs there will be a divergence between private and
 social costs.
C) In general, the tendency is for private firms to totally ignore the damage costs.
D) In most instances, the economic optimum is associated with a positive level of
 pollution emission.
E) All of the above are true.

Quizplus · Accepted Answer

Each statement accurately reflects aspects of the optimal level of pollution. A) highlights the discrepancy between private and societal costs, B) notes the divergence in damage costs, C) points out the general tendency of firms to overlook damage costs, and D) acknowledges that the economic optimum often involves some level of pollution, recognizing the impracticality of achieving zero emissions without incurring prohibitive costs.

Which of the Following Is True in Regard to the Optimal