Use the following to answer question:
Figure: Pollution and Efficiency
-(Figure: Pollution and Efficiency)Use Figure: Pollution and Efficiency.In this market,in which sulfur emissions are a result of production,too much pollution is found when the price is _____ and the quantity is _____.
A)$5;15
B)$5;40
C)$25;20
D)$5;30

Question

Use the following to answer question:
Figure: Pollution and Efficiency 
-(Figure: Pollution and Efficiency)Use Figure: Pollution and Efficiency.In this market,in which sulfur emissions are a result of production,too much pollution is found when the price is _____ and the quantity is _____.
A)$5;15 
B)$5;40 
C)$25;20 
D)$5;30

Quizplus · Accepted Answer

In the graph, the socially optimal level of pollution is at point A, where the marginal cost of reducing pollution (MC) intersects with the marginal benefit of reducing pollution (MB). At this point, the price is $5 and the quantity is 40 units. Any level of pollution beyond point A is considered too much pollution as the cost of reducing pollution exceeds the benefit. Therefore, the answer is B as at $5 and the quantity of 40 units, the pollution level is considered too much.

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