Suppose that in most car collisions between cars of unequal size, the smaller car sustains the most damage and its occupants suffer the most injury. In answering the following question, assume that, on average, smaller cars generate less air pollution than larger cars and that every person in the economy drives at least one car. As the average size of cars increases, an individual's incentive to buy a smaller car:
A)increases in order to prevent injury to others.
B)increases to offset the external cost of air pollution.
C)decreases because of the increased risk of injury in a collision.
D)remains the same because car purchases depend on individual preferences.

Question

Quizplus · Accepted Answer

The outcome of a collision is determined by relative size. As more people buy larger cars, those with smaller cars expect even worse outcomes in the event of a collision.

Suppose That in Most Car Collisions Between Cars of Unequal