If production is characterized by variable technology, the optimal level of air quality occurs where
a. the marginal private cost of air quality equals the marginal social benefit
b. the marginal social cost of air quality equals the marginal social benefit
c. the marginal social cost of air quality equals the marginal private cost of air quality
d. government regulators set it
e. all costs are absorbed by the polluter
B
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Which of the following is not an argument by those who oppose tax-law changes to encourage saving?
a. Saving is not very responsive to changes in the tax rate. b. Saving is not an important determinant of a nation's ability to produce output. c. Reducing the budget deficit instead of changing the tax laws could raise saving. d. Changes in the tax laws to induce saving would distribute the tax burden less fairly.
Large minimum efficient scale of plant combined with limited market demand may lead to:
A. natural monopoly. B. patent monopoly. C. government franchise monopoly. D. shared monopoly.