Question

A paper plant produces water pollution during the production process. If the government forces the plant to internalize the negative externality, then the

Answer 1

The supply curve for paper would shift to the left.

What is a  supply curve?

In economics, the supply curve is a graphic depiction of the relationship between the price of a good and the amount of it that a seller is willing and able to supply. The graph's horizontal axis represents supply quantity and the vertical axis represents product pricing.

Given that there is a direct correlation between product price and quantity delivered, the supply curve is typically depicted as a slope increasing higher from left to right. Certain ceteris paribus (other things being equal) requirements must hold true for this relationship to exist.

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