Suppose the government mandates the installation of certain type of pollution abatement equipment for the leather tannery industry. For some firms in the industry, installing this equipment may not be the most cost effective method of reducing pollution.

Question

Quizplus · Accepted Answer

This is true. Some firms may already have implemented other methods of reducing pollution that are more cost-effective for their specific operations. Mandating a certain type of equipment for all firms in the industry may not take into account these individual differences in operations and could potentially result in unnecessary expenses for some firms.

Suppose the Government Mandates the Installation of Certain Type of Pollution