Question 1

The marginal social benefit (MSB) of abatement represents

Accepted Answer

A)  the additional gains to society from reducing pollution 
B)  the reduction in damages from abatement 
C)  society's demand for abatement or environmental quality 
D)  all of the above 
A)  the additional gains to society from reducing pollution 
B)  the reduction in damages from abatement 
C)  society's demand for abatement or environmental quality 
D)  all of the above

Question 2

Ambient standards identify the desired level of environmental level to be achieved, typically expressed as a maximum allowable concentration of a pollutant.

Accepted Answer

A) True 
 B)False

Question 3

Standards are the fundamental basis of most environmental policies.

Accepted Answer

A) True 
 B)False

Question 4

Much of the air pollution in Catano, Puerto Rico was linked to a nearby oil refinery.

Accepted Answer

A) True 
 B)False

Question 5

The sum of all polluters' MACs equals the marginal social cost (MSC) of abatement.

Accepted Answer

A) True 
 B)False

Question 6

A performance-based standard

Accepted Answer

A)  specifies a pollution limit and lets polluters select the technology to achieve that limit 
B)  is less flexible than a technology-based standard 
C)  designates the equipment or control method to be used for pollution abatement 
D)  none of the above 
A)  specifies a pollution limit and lets polluters select the technology to achieve that limit 
B)  is less flexible than a technology-based standard 
C)  designates the equipment or control method to be used for pollution abatement 
D)  none of the above

Question 7

If an environmental standard is set at a level where the associated marginal abatement cost (MAC) is equal to the marginal social benefit (MSB), it is considered an allocatively efficient standard.

Accepted Answer

A) True 
 B)False

Question 8

An ambient standard

Accepted Answer

A)  specifies a pollution limit and lets polluters choose the technology to achieve that limit 
B)  designates the equipment or control method that must be used to abate pollution 
C)  assures that the least-cost abatement approach will be used by all polluters 
D)  none of the above 
A)  specifies a pollution limit and lets polluters choose the technology to achieve that limit 
B)  designates the equipment or control method that must be used to abate pollution 
C)  assures that the least-cost abatement approach will be used by all polluters 
D)  none of the above

Question 9

To determine the marginal social cost (MSC) of abatement, we find the sum of

Accepted Answer

A)  MPC + MAC 
B)   $\Sigma$MAC + MCE 
C)  MAC + $\Sigma$MCE 
D)  MAC + $\Sigma$MEC 
A)  MPC + MAC 
B)   $\Sigma$MAC + MCE 
C)  MAC + $\Sigma$MCE 
D)  MAC + $\Sigma$MEC

Question 10

Suppose that two firms, X and Y, face the following abatement costs:
MACS1U1B1XS1U1B0 = 1.2AS1U1B1XS1U1B0, MACS1U1B1YS1U1B0 = 0.3AS1U1B1YS1U1B0
TACS1U1B1XS1U1B0 = 0.6AS1U1B1XS1U1B0S1U1P12S1S1P0 S1U1B1 S1U1B0S1U1B1 S1U1B0TACS1U1B1YS1U1B0 = 0.15AS1U1B1YS1U1B0S1U1P12S1S1P0
Further assume that the combined abatement standard is 40 units for both firms. Use this information for any or all of Questions .
-Based on this model, if the government uses a uniform standard

Accepted Answer

A)  the total abatement cost for firm X is $24 
B)  the total abatement cost for firm Y is $12 
C)  the combined total abatement cost for both firms is $1,200 
D)  the combined total abatement cost for both firms is $300 
A)  the total abatement cost for firm X is $24 
B)  the total abatement cost for firm Y is $12 
C)  the combined total abatement cost for both firms is $1,200 
D)  the combined total abatement cost for both firms is $300

Question 11

Marginal social benefit (MSB) of abatement can be thought of as the reduction in damages linked to reducing pollution.

Accepted Answer

A) True 
 B)False

Question 12

By definition, the marginal abatement cost (MAC) curve shows the change in costs associated with higher levels of abatement, using the most widely available technology.

Accepted Answer

A) True 
 B)False

Question 13

A benefit-based standard

Accepted Answer

A)  is one that balances social benefits with social costs, at the margin 
B)  achieves allocative efficiency 
C)  achieves a cost-effective level of pollution abatement 
D)  is set to improve society's well-being without consideration for costs 
A)  is one that balances social benefits with social costs, at the margin 
B)  achieves allocative efficiency 
C)  achieves a cost-effective level of pollution abatement 
D)  is set to improve society's well-being without consideration for costs

Question 14

If a standard is set to balance the well-being of society with the associated costs, it is called a benefit-based standard.

Accepted Answer

A) True 
 B)False

Question 15

Hypothetically, suppose a recent study of hazardous waste abatement (A) arrives at the following national estimates for abating chemical solvents: MSB = 100 - 0.75A and MSC = 20 + 0.50A, where A is measured in millions of tons per year, and costs are measured in millions of dollars.
a. Based on this information, what would be the national standard for an allocatively efficient abatement?
b. Under what conditions would this level be efficient at the regional level?
c. If instead the government set the abatement standard at 50 million tons per year, would that standard be too lenient or too restrictive at the national level? Support your answer with specific values.

Accepted Answer

2a. Allocative efficiency occurs at the

Question 16

A technology-based standard

Accepted Answer

A)  specifies a pollution limit to be achieved and allows polluters to choose the technology to reach that limit 
B)  is more flexible than a performance-based standard 
C)  designates the equipment or control method to be used for pollution abatement 
D)  assures the use of the least-cost abatement technology. 
A)  specifies a pollution limit to be achieved and allows polluters to choose the technology to reach that limit 
B)  is more flexible than a performance-based standard 
C)  designates the equipment or control method to be used for pollution abatement 
D)  assures the use of the least-cost abatement technology.

Question 17

If the MACs for firm 1 and 2 are: MAC1 = 0.4A1 and MAC2 = 0.8A2, respectively, and the combined abatement standard is 15 units, then the cost-effective abatement levels are 10 units for firm 1 and 5 units for firm 2.

Accepted Answer

A) True 
 B)False

Question 18

Suppose that two firms, X and Y, face the following abatement costs:
MACS1U1B1XS1U1B0 = 1.2AS1U1B1XS1U1B0, MACS1U1B1YS1U1B0 = 0.3AS1U1B1YS1U1B0
TACS1U1B1XS1U1B0 = 0.6AS1U1B1XS1U1B0S1U1P12S1S1P0 S1U1B1 S1U1B0S1U1B1 S1U1B0TACS1U1B1YS1U1B0 = 0.15AS1U1B1YS1U1B0S1U1P12S1S1P0
Further assume that the combined abatement standard is 40 units for both firms. Use this information for any or all of Questions .
-The cost savings associated with the cost-effective solution relative to a uniform standard equals

Accepted Answer

A)  $300 
B)  $108 
C)  $10.8 
D)  $9.60 
A)  $300 
B)  $108 
C)  $10.8 
D)  $9.60

Question 19

A standard that identifies a pollution limit to be achieved without defining the technology to be used is called a(n)

Accepted Answer

A)  ambient standard 
B)  performance-based standard 
C)  technology-based standard 
D)  efficient standard 
A)  ambient standard 
B)  performance-based standard 
C)  technology-based standard 
D)  efficient standard

Question 20

A standard that specifies a pollution limit along with the equipment to be used to achieve that limit is called a performance-based standard.

Accepted Answer

A) True 
 B)False

The marginal social benefit (MSB) of abatement represents

Ambient standards identify the desired level of environmental level to be achieved, typically expressed as a maximum allowable concentration of a pollutant.

Standards are the fundamental basis of most environmental policies.

Much of the air pollution in Catano, Puerto Rico was linked to a nearby oil refinery.

The sum of all polluters' MACs equals the marginal social cost (MSC) of abatement.

A performance-based standard

If an environmental standard is set at a level where the associated marginal abatement cost (MAC) is equal to the marginal social benefit (MSB), it is considered an allocatively efficient standard.

An ambient standard

To determine the marginal social cost (MSC) of abatement, we find the sum of

Marginal social benefit (MSB) of abatement can be thought of as the reduction in damages linked to reducing pollution.

By definition, the marginal abatement cost (MAC) curve shows the change in costs associated with higher levels of abatement, using the most widely available technology.

A benefit-based standard

If a standard is set to balance the well-being of society with the associated costs, it is called a benefit-based standard.

A technology-based standard

If the MACs for firm 1 and 2 are: MAC₁ = 0.4A₁ and MAC₂ = 0.8A₂, respectively, and the combined abatement standard is 15 units, then the cost-effective abatement levels are 10 units for firm 1 and 5 units for firm 2.

A standard that identifies a pollution limit to be achieved without defining the technology to be used is called a(n)

A standard that specifies a pollution limit along with the equipment to be used to achieve that limit is called a performance-based standard.

The Role of Economics in Environmental Management

Modeling the Market Process: a Review of the Basics

Modeling Market Failure

Economic Solutions to Environmental Problems: the Market Approach

Environmental Risk Analysis

Assessing Benefits for Environmental Decision Making

Assessing Costs for Environmental Decision Making

Benefit-Cost Analysis in Environmental Decision Making

Defining Air Quality: the Standard-Setting Process

Improving Air Quality: Controlling Mobile Sources

Improving Air Quality: Controlling Stationary Sources

Global Air Quality: Policies for Ozone Depletion and Climate Change

Defining Water Quality: the Standard-Setting Process

Improving Water Quality: Controlling Point and Nonpoint Sources

Protecting Safe Drinking Water

Managing Hazardous Solid Waste and Waste Sites

Managing Municipal Solid Waste

Controlling Pesticides and Toxic Chemicals

Sustainable Development: International Environmental Agreements and International Trade

Sustainable Approaches: Industrial Ecology and Pollution Prevention

Filters

Exam 4: Conventional Solutions to Environmental Problems: Command-And-Control Approach

The marginal social benefit (MSB) of abatement represents

Ambient standards identify the desired level of environmental level to be achieved, typically expressed as a maximum allowable concentration of a pollutant.

Standards are the fundamental basis of most environmental policies.

Much of the air pollution in Catano, Puerto Rico was linked to a nearby oil refinery.

The sum of all polluters' MACs equals the marginal social cost (MSC) of abatement.

A performance-based standard

If an environmental standard is set at a level where the associated marginal abatement cost (MAC) is equal to the marginal social benefit (MSB), it is considered an allocatively efficient standard.

An ambient standard

To determine the marginal social cost (MSC) of abatement, we find the sum of

Marginal social benefit (MSB) of abatement can be thought of as the reduction in damages linked to reducing pollution.

By definition, the marginal abatement cost (MAC) curve shows the change in costs associated with higher levels of abatement, using the most widely available technology.

A benefit-based standard

If a standard is set to balance the well-being of society with the associated costs, it is called a benefit-based standard.

A technology-based standard

If the MACs for firm 1 and 2 are: MAC1 = 0.4A1 and MAC2 = 0.8A2, respectively, and the combined abatement standard is 15 units, then the cost-effective abatement levels are 10 units for firm 1 and 5 units for firm 2.

A standard that identifies a pollution limit to be achieved without defining the technology to be used is called a(n)

A standard that specifies a pollution limit along with the equipment to be used to achieve that limit is called a performance-based standard.

The Role of Economics in Environmental Management

Modeling the Market Process: a Review of the Basics

Modeling Market Failure

Economic Solutions to Environmental Problems: the Market Approach

Environmental Risk Analysis

Assessing Benefits for Environmental Decision Making

Assessing Costs for Environmental Decision Making

Benefit-Cost Analysis in Environmental Decision Making

Defining Air Quality: the Standard-Setting Process

Improving Air Quality: Controlling Mobile Sources

Improving Air Quality: Controlling Stationary Sources

Global Air Quality: Policies for Ozone Depletion and Climate Change

Defining Water Quality: the Standard-Setting Process

Improving Water Quality: Controlling Point and Nonpoint Sources

Protecting Safe Drinking Water

Managing Hazardous Solid Waste and Waste Sites

Managing Municipal Solid Waste

Controlling Pesticides and Toxic Chemicals

Sustainable Development: International Environmental Agreements and International Trade

Sustainable Approaches: Industrial Ecology and Pollution Prevention

Filters

If the MACs for firm 1 and 2 are: MAC₁ = 0.4A₁ and MAC₂ = 0.8A₂, respectively, and the combined abatement standard is 15 units, then the cost-effective abatement levels are 10 units for firm 1 and 5 units for firm 2.