A paper mill discharges chemicals into a river which pollutes the shores of a downstream resort area.The private marginal cost,social marginal cost,and marginal benefit associated with the production of paper are given by the following equations: MCP = 5 + Q MCS = 10 + 2Q MB = 35 - 0.5Q.
A competitive free market will produce output of ________ units, and this amount is ________ than the allocatively efficient level of output.
A) 5; less
B) 10; less
C) 15; more
D) 20; more
E) 25; more
Correct Answer:
Verified
Q1: A paper mill discharges chemicals into a
Q4: The figure below shows the marginal benefit
Q7: A paper mill discharges chemicals into a
Q8: The social marginal cost of the production
Q9: A paper mill discharges chemicals into a
Q9: When firms in an industry have fully
Q11: A paper mill discharges chemicals into a
Q15: Economists generally view pollution as
A)an economic "bad"
Q19: If pollution is associated with the production
Q20: The figure below shows the marginal benefit
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