Question

If the MB of polluting increased, then what would happen to the optimal level of pollution? Multiple Choice Print Unsure Decrease Stay the same Increase

Answer 1

Answer: If the MB of polluting increased, then what would happen to the optimal level of pollution? The optimal level of pollution will decrease.

Explanation: When the Marginal Benefit of pollution increases, the optimal level of pollution will decrease.

If the marginal benefit of reducing pollution were higher than the marginal cost of reducing pollution, then society would benefit from a decrease in pollution. The advantage would be equal to the amount by which the marginal benefit of the cleanup exceeded the marginal cost of the clean up.