Those opposed to fracking, a method of extracting natural gas through breaking up underground rocks with chemicals and water, warn that this method might pollute nearby sources of drinking water.
-If this pollution occurs, the market equilibrium with no government intervention extracts ________ natural gas than the efficient quantity and ________ a deadweight loss.
A) less; does not create
B) more; does not create
C) less; creates
D) more; creates

Question

Quizplus · Accepted Answer

Fracking can lead to negative externalities such as water pollution, causing the market to produce more natural gas than is socially optimal, resulting in a deadweight loss.

Those Opposed to Fracking, a Method of Extracting Natural Gas