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# Macroeconomics Study Set 42

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## Quiz 17 : The Economics of Environmental Protection

When a farmer in Manitoba produces fertilizer run-off that pollutes the local water system,
Free
Multiple Choice

E

A paper mill discharges chemicals into a river which pollutes the shores of a downstream resort area. The private marginal cost, social marginal cost, and marginal benefit associated with the production of paper are given by the following equations: MCP = 5 + Q MCS = 10 + 2Q MB = 35 - 0.5Q. The marginal external cost at the allocatively efficient level of output is
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Multiple Choice

D

When an external cost associated with the production of some good has been internalized, it means that
Free
Multiple Choice

C

A paper mill discharges chemicals into a river which pollutes the shores of a downstream resort area. The private marginal cost, social marginal cost, and marginal benefit associated with the production of paper are given by the following equations: MCP = 5 + Q MCS = 10 + 2Q MB = 35 - 0.5Q. A competitive free market will produce output of units, and this amount is than the allocatively efficient level of output.
Multiple Choice
The social marginal cost of the production of snowmobiles
Multiple Choice
When firms in an industry have fully internalized a production externality,
Multiple Choice
If pollution is associated with the production of some good, then
Multiple Choice
A paper mill discharges chemicals into a river which pollutes the shores of a downstream resort area. The private marginal cost, social marginal cost, and marginal benefit associated with the production of paper are given by the following equations: MCP = 5 + Q MCS = 10 + 2Q MB = 35 - 0.5Q. The allocatively efficient level of output is units.
Multiple Choice
A paper mill discharges chemicals into a river which pollutes the shores of a downstream resort area. The private marginal cost, social marginal cost, and marginal benefit associated with the production of paper are given by the following equations: MCP = 5 + Q MCS = 10 + 2Q MB = 35 - 0.5Q. The marginal external cost at the competitive free-market equilibrium is
Multiple Choice
Economists generally view pollution as
Multiple Choice
A paper mill discharges chemicals into a river which pollutes the shores of a downstream resort area. The private marginal cost, social marginal cost, and marginal benefit associated with the production of paper are given by the following equations: MCP = 5 + Q MCS = 10 + 2Q MB = 35 - 0.5Q. The marginal external cost is throughout the output range.
Multiple Choice
The figure below shows the marginal benefit to consumers, MB, the marginal cost to private firms, MCP, and the marginal cost to society, MCS, at each level of output of some good. FIGURE 17-1 -Refer to Figure 17-1. The socially optimal level of output is
Multiple Choice
The figure below shows the marginal benefit to consumers, MB, the marginal cost to private firms, MCP, and the marginal cost to society, MCS, at each level of output of some good. FIGURE 17-1 -Refer to Figure 17-1. The price that leads consumers to demand the socially optimal quantity of output is
Multiple Choice
The figure below shows the marginal benefit to consumers, MB, the marginal cost to private firms, MCP, and the marginal cost to society, MCS, at each level of output of some good. FIGURE 17-1 -Refer to Figure 17-1. The equilibrium output that would occur in a competitive market in the absence of government intervention is
Multiple Choice
Suppose a firm producing roof shingles imposes a negative externality on the surrounding area due to the noxious fumes emitted from the plant. The private marginal cost, social marginal cost and marginal benefit associated with the production of the shingles are given by the following equations: MCP = 5 + 2Q MCS = 10 + 3Q MB = 50 - Q A competitive free market will produce units, at a price of per unit.
Multiple Choice
The figure below shows the marginal benefit to consumers, MB, the marginal cost to private firms, MCP, and the marginal cost to society, MCS, at each level of output of some good. FIGURE 17-1 -Refer to Figure 17-1. The price that would occur in a competitive market in the absence of government intervention is
Multiple Choice