What will be the total social cost of having a differential standard (set for the rural sector and for the urban sector separately)? (B + D + E) + (A + B + C + D + E) A + B +C + D + E + F B + D +E A +B +C +D + E 2.2 What will be the total social cost of having a standard for the country (both sectors) set at Er? (B + D + E) + (A + B + C + D + E + F) A + B +C + D + E + F B + D +E A +B +C +D + E 2.3 What will be the total social cost of having a standard for the country (both sectors) set at Eu? (B + D + E) + (A + B + C + D + E + F) A + B +C + D + E + F B + D +E (B + C + D + E) + (A + B + C + D + E)

Exploring Economics
8th Edition
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter8: Market Failure
Section: Chapter Questions
Problem 3P
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The government is concerned with air pollution and decided to apply a uniform standard in the country. Economists in the Ministry of Environment suggested the level Eu, based on studies that are concerned with the urban regions. Economists in the ministry of agriculture suggested the level Er, based on studies conducted on rural population.

 

2.1 What will be the total social cost of having a differential standard (set for the rural sector and for the urban sector separately)?

  1. (B + D + E) + (A + B + C + D + E)
  2. A + B +C + D + E + F
  3. B + D +E
  4. A +B +C +D + E

2.2 What will be the total social cost of having a standard for the country (both sectors) set at Er?

  1. (B + D + E) + (A + B + C + D + E + F)
  2. A + B +C + D + E + F
  3. B + D +E
  4. A +B +C +D + E

2.3 What will be the total social cost of having a standard for the country (both sectors) set at Eu?

  1. (B + D + E) + (A + B + C + D + E + F)
  2. A + B +C + D + E + F
  3. B + D +E
  4. (B + C + D + E) + (A + B + C + D + E)

 

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