When Using the Economic Efficiency Approach to Controlling Air and Water

question 185

Multiple Choice

When using the economic efficiency approach to controlling air and water pollution, the government

• A)forces each firm to produce emissions in the most cost efficient manner irrespective of its cost structure
• B)offers each firm the flexibility to reduce emissions in the most cost effective manner, given its unique cost structure
• C)offers each firm the option of choosing between the cost minimizing emission level and the profit maximizing emission level
• D)provides each firm with some fixed rules and then requires them to maximize profits given these fixed rules
• E)offers each firm the option of using marginal cost pricing and average cost pricing when determining the optimum emissions levels

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Definitions:

Muscarinic

Referring to a class of cholinergic receptors found in various body tissues, and responding to the neurotransmitter acetylcholine.

Adrenergic

Relating to nerve cells in which adrenaline (epinephrine) or noradrenaline (norepinephrine) function as neurotransmitters, involved in the body's fight-or-flight response.

Autonomic

Pertaining to the autonomic nervous system, which regulates involuntary bodily functions such as heart rate and digestion.

Blood Vessel

Tubular structures carrying blood through the tissues and organs; a vein, artery, or capillary.