Marginal social cost (MSC) of some abatement level, A₁, can be determined as the area under the total social cost (TSC) function up to A₁.

Question

Quizplus · Accepted Answer

Marginal social cost (MSC) refers to the additional cost associated with a one-unit increase in the level of an activity (such as pollution abatement) and is represented by the slope of the Total Social Cost (TSC) curve at any given point, not the area under the TSC curve up to that point.

Marginal Social Cost (MSC) of Some Abatement Level, A1, Can

Marginal Social Cost (MSC) of Some Abatement Level, A₁, Can