Narrbegin Exhibit 10.2 Carbon emissions as an externality
-In Exhibit 10.2, the market demand curve 'Demand' and market supply curve 'Supply 1' establish a:

Question

Narrbegin Exhibit 10.2 Carbon emissions as an externality  
-In Exhibit 10.2, the market demand curve 'Demand' and market supply curve 'Supply 1' establish a:

Quizplus · Accepted Answer

The market demand and supply curves intersect at a point known as market equilibrium, where the quantity demanded and supplied are equal at a certain price level. In this case, the market equilibrium determines both the price and quantity of emissions. However, this may not result in a socially desirable level of emissions, as carbon emissions are recognized as an externality with negative impacts on the environment and public health. Thus, intervention in the market through regulation or pricing mechanisms may be necessary to ensure a socially optimal level of emissions.