The optimal level of pollution control occurs when
A)MSB of control equals MSC
B)Pollution is zero
C)MSB of control just exceeds MSC
D)MSB of control is less than MSC
E)None of the above

Question

Quizplus · Accepted Answer

The optimal level of pollution control occurs when the marginal social benefit (MSB) of control equals the marginal social cost (MSC) of control. This ensures that the benefits of pollution control are exactly equal to the costs, resulting in an efficient allocation of resources. Option B is not ideal because it is not always possible, and in some cases, some level of pollution may be necessary to support economic activity. Options C and D are not efficient because either the benefits of pollution control exceed the costs or vice versa. Option E is incorrect since one of the above options is the correct answer.

The Optimal Level of Pollution Control Occurs When