Question

The advanced machinery used for limestone quarrying in a particular region leads to noise pollution and affects the hearing ability of people residing in the neighborhood. The quarrying activity also results in soil erosion. According to an environmental research​ group, the market price and output of limestone in this region is much higher than the socially efficient​ level, as the limestone producers do not include the social cost of production in their output decision. The group formally requests the government to impose a tax on limestone production to internalize the externality.
Which of the​ following, if​ true, would support the taxation policy proposed by the research​ group?
A. Recent environmental research reveals that the dust from the limestone quarrying site has severely contaminated the water at a nearby lake.
B. Limestone producers in this region pay very high income taxes.
C. Scientists have recently developed​ cost-effective and​easy-to-install sound filtering systems for limestone plants.
D. The limestone industry provides employment opportunities to a significant percentage of unskilled laborers in the region.
E. This country is the largest exporter of limestone.

Answer 1

Answer:

A. Recent environmental research reveals that the dust from the limestone quarrying site has severely contaminated the water at a nearby lake.

Explanation:

The limestone production results in huge social effects like, noise pollution, soil pollution, which affects lives of people. And since the manufacturers or producers of limestone do not care about the social results of such production, they shall be liable to pay huge taxes.

As for this, the cause as stated in statement A is absolutely suitable.

Also the prices are more in this area even after so much of social destruction.

Accordingly high taxes as a penalty for such social destruction shall be charged.