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Market failure and externalities

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Question 15

An agricultural chemical manufacturer introduces a closed-loop recycling system that prevents toxic wastewater from leaking into the local river basin, but requires the continuous use of expensive neutralising agents during the production process. Which of the following is most likely to rise?

Marginal external cost (MECMECMEC)

Marginal external benefit (MEBMEBMEB)

Marginal private cost (MPCMPCMPC)

Marginal private benefit (MPBMPBMPB)

Market failure and externalities Questions

  1. A Level
  2. /Economics
  3. /Market failure and externalities