UMass

RESEC 262 Summer

1) The Clean Air Act requires the EPA to set these standards "requisite to

protect the public health" with "an adequate margin of safety." This has been

referred to as zero-risk standards. Use the graph below to answer the

questions below concerning the economics of zero-risk ambient

concentration standards.

Aggregate marginal

abatement costs

A¹

A²

A³

Aggregate marginal

damage

A4

Problem

A5

Ambient

concentration

a. What is the maximum ambient concentration in the graph that

would achieve the zero-risk goal? [1 point]

b. Is a zero-risk ambient concentration standard likely to be efficient?

Why? [2 point]