Tackle the Test: Free-Response Questions

  1. Question

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    Rubric for FRQ 1 (6 points)

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    1 point: The vertical axis is labeled “Marginal social cost, marginal social benefit” or “Dollars per unit” and the horizontal axis is labeled “Quantity of pollution” or “Q.”

    1 point: The marginal social cost curve is labeled and upward-sloping.

    1 point: The marginal social benefit curve is labeled and downward-sloping.

    1 point: The market-determined level of pollution is shown on the horizontal axis where the marginal social benefit curve reaches the horizontal axis.

    1 point: In the absence of intervention and private deals, the marginal cost to a polluter of polluting is zero. Thus, pollution will continue until the marginal social benefit (all of which goes to the polluter) equals the polluter’s marginal cost of zero, which occurs at the horizontal intercept of the marginal social cost curve.

    1 point: The socially optimal level of pollution is shown on the horizontal axis below the intersection of MSC and MSB.

  2. Question

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