In general, if the level of the marginal cost of pollution damage equals the marginal cost of pollution abatement, then:
A) economic efficiency is achieved.
B) economic efficiency is not achieved.
C) the level of pollution is zero.
D) marginal cost of abatement is greater than marginal cost of damages.

Question

Quizplus · Accepted Answer

When the marginal cost of pollution abatement equals the marginal cost of pollution damage, economic efficiency is achieved. This is because the marginal benefit from either increasing or decreasing pollution is exactly equal to the marginal cost associated with either action, ensuring that no further gains can be made by adjusting the level of pollution. This balance ensures that society allocates resources in such a way as to maximize overall welfare.

In General, If the Level of the Marginal Cost of Pollution