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Sagot :
Answer: B) When levels of pollution are high, the marginal benefit of reducing pollution also is high. It follows therefore that the benefit of reducing air pollution in 1970 would be much higher than the benefit from a proportional reduction in air pollution today when the level of pollution is much lower.
Explanation:
Marginal benefits follow a returns to scale model which means that overtime, the benefits received per additional unit of output is less than the benefit before it.
In the context of pollution, there was much more pollution in 1970 so reducing pollution gave a high marginal benefit. As the air became cleaner however and pollution dropped, the benefit began decreasing because there was less pollution to clean and benefit from.
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