If firms in a perfectly competitive industry pollute the air and there is no government regulation or intervention in the market, then compared to the socially optimallevels,OA. the market price will be too high and industry output too low.OB. the market price will be too low and industry output too high.C. the market price and industry output will be at the socially optimal levels.D. we do not have enough information to determine which of these is true.

A market characterized by perfect competition features many firms that are price takers with no…

If firms in a perfectly competitive industry pollute the air and there is no government regulation or intervention in the market, then compared to the socially optimal levels, OA. the market price will be too high and industry output too low. B. the market price will be too low and industry output too high. OC. the market price and industry output will be at the socially optimal levels. D. we do not have enough information to determine which of these is true.

If firms in a perfectly competitive industry pollute the air and there is no government regulation or intervention in the market, then compared to the socially optimal levels, OA. the market price will be too high and industry output too low. B. the market price will be too low and industry output too high. OC. the market price and industry output will be at the socially optimal levels. D. we do not have enough information to determine which of these is true.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter12: Environmental Protection And Negative Externalities

Section: Chapter Questions

Problem 2SCQ: Identify whether the market supply curve will shift right or left or will stay the same for the...

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