There is a growing trend where society is increasingly expecting firms to be corporate socially responsible: where
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Question:
There is a growing trend where society is increasingly expecting firms to be corporate socially responsible: where firms need to be considerate of their actions on society and the broader environment.
a.Suppose negative externalities are produced alongside output in a firms production process. If the firms objective is to maximise profit, explain why they do not want to be corporate socially responsible.
bAnticipating it to be affected by overly harsh government environmental protection regulation, a firm decides to self−regulate by adopting corporate social responsibility as its objective. Explain how this will affect the firms output level. What will happen to the negative externalities that it produces?
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