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Chapter 31: Q.16 (page 708)

Explain why a society usually would not determine that a degree of 0 per cent air cleanliness is optimal.

Short Answer

Expert verified

The socially ideal degree of contamination or level of air tidiness happens where the marginal cost of contamination decrease is equivalent to the marginal cost of contamination reduction.

Step by step solution

01

Introduction

At points lower than that the marginal benefit from clean air increments than the marginal benefit from cleaning the air. The socially helpful degree of contamination or clear air is given where the marginal benefit is equivalent to the marginal cost. As it is difficult to live in a too grimy climate, having a too perfect environment is likewise unrealistic.

02

Explanation

Contamination can never be headed to anything. A 100% level of air tidiness would suggest no level of contamination. On the off chance that we attempt to accomplish a 100%level of air tidiness, this would imply that the cost of this decrease in contamination surpasses the benefit from this decrease. Consequently, it isn't doable to have a 100% level of air tidiness. Besides, our regular framework has the ability to absorb some level of contamination. Consequently, some level of contamination is consistently ideal.

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Most popular questions from this chapter

Should policymakers impose additional costly anti-plastics pollution requirements if the marginal benefit of pollution abatement currently equals the marginal cost? Explain.

The market price of insecticide is initially \(10per unit. To address a negative externality in this market, the government decides to charge producers of insecticide for the privilege of polluting during the production process. A fee that fully takes into account the social costs of pollution is determined, and once it is pat into effect, the market supply curve for insecticide shifts upward by \)4 per unit. The market price of insecticide also increases, to $12 per unit. What fee is the government charging insecticide manufacturers?

What is the specific reason that accounting for externalities and thereby shifting the market supply curve causes the equilibrium quantity of Good X to decline from Q1 to Q2?

The following table gives hypothetical annual total costs and total benefits of maintaining alternative populations of Asian elephants.

a. Calculate the marginal costs and benefits, and draw marginal benefit and cost schedules.

b. Given the data, what is the socially optimal world population of Asian elephants?

c. Suppose that two events occur simultaneously. Technological development allows machines to do more efficiently much of the work that elephants once did, which reduces by \(10million the marginal benefit of maintaining the elephant population for each 7,500increment in the elephant population. In addition, new techniques for breeding, feeding, and protecting elephants reduce the marginal cost by \)40million for each 7,500increment in the elephant population. What is the new socially optimal population of Asian elephants?

Consider the diagram below and respond to the questions that follow.

a. Assume that a new technique for decreasing water pollution lowers the marginal cost of pollution reduction at every level of water cleanliness. Will the ideal % degree of water cleanliness rise or decline after this event? Will the cost of the final unit of water cleanup grow or decrease? Include a visual to help you explain your point.

b. Assume that the event described in item (a) occurs, and that medical studies show that the marginal benefit from reducing water pollution is higher at all levels of water purity. Will the ideal % degree of water cleanliness rise or decrease after both events? Can you predict whether the cost of the last unit of water cleanup will increase or decrease as compared to the initial optimum? To help you clarify your answers, create a new diagram.
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