Answer to Question #229263 in Economics for Jennifer Masanabo

Question

1. It has come to the attention of the Department of Environmental Affairs that "Air pollution kills 20 

000 people in South Africa every year, costing the economy nearly R300 million according to new 

research from the World Bank". As a solution the Minister of Environmental Affairs has proposed 

stringent pollution controls on the flow of residuals. Discuss the implication of the statement 

above on the flow of residuals in the economy and on the law of thermodynamics. 

Answer 1

Reaching a more stringent concentration of residuals in the discharge flow will require additional investments into the treatment facilities. Therefore, this will put an additional financial burden on producers and eventually increase final product cost. On the other hand, improved environmental regulations will preserve people's lives. This consequently will increase product demand on the market and will elevate the workforce offer.