If the forgone rent is less than the abatement cost, the factories will still create some pollution,

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If the forgone rent is less than the abatement cost, the factories will still create some pollution, but it will be the efficient quantity. If the abatement cost is lower than the forgone rent, the factories will stop polluting, but they will produce less paint because marginal cost includes the abatement cost.

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Foundations Of Microeconomics

ISBN: 9780134491981

8th Edition

Authors: Robin Bade, Michael Parkin

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