AP® Microeconomics

Free Version

Upgrade subject to access all content

Easy

Externality Reduction: Optimal Amount

APMICR-XEGSSL

Which of the following is true regarding reduction of an externality such as pollution?

A

Pollution should be reduced as long as it provides health benefits to society.

B

Pollution should not be reduced if pollution abatement creates costs that negatively impact businesses.

C

Pollution should be reduced only if the average costs of pollution reduction are less than the average benefits.

D

Pollution should continue to be reduced as long as the marginal benefits of pollution reduction exceed the marginal costs.

E

Pollution should be reduced as long as the total benefits exceed the total costs.