A new pollution law requires businesses to pay for inspections of their plants by independent pollution-monitoring firms.What effect is this likely to have?
A)Increase productivity
B)Increase the capital stock
C)Reduce productivity
D)Increase the demand for labor in those firms

Question

Quizplus · Accepted Answer

The requirement for businesses to pay for independent pollution-monitoring inspections will likely increase their costs and reduce their productivity. They will need to allocate resources towards complying with the new law, which may lead to lower profits, decreased investment in capital stock, and potentially downsizing their workforce.

A New Pollution Law Requires Businesses to Pay for Inspections