The marginal social benefit curve for water quality slopes downward because
A)the total benefit from clean water decreases as water becomes cleaner
B)the added benefit from cleaner water is greater when water quality is poor than when water quality is high
C)the added benefit from cleaner water is smaller when water quality is poor than when water quality is high
D)the total benefit from clean water increases as water becomes cleaner
E)people demand clean water at any price

Question

Quizplus · Accepted Answer

The marginal social benefit curve for water quality slopes downward because the added benefit from cleaner water is greater when water quality is poor than when water quality is high. As water quality improves, the additional benefits of further improvements in water quality become smaller and smaller. Therefore, the marginal social benefit curve for water quality slopes downward.

The Marginal Social Benefit Curve for Water Quality Slopes Downward