With Tradable Emissions Permits,the Main Problem Is Determining the _____,While

question 152

Multiple Choice

With tradable emissions permits,the main problem is determining the _____,while with emissions taxes,the main problem is determining the _____.

• A)optimal quantity of pollution;optimal tax rate
• B)optimal price of the permits;optimal level of pollution
• C)optimal quantity of pollution;marginal social benefit of pollution
• D)marginal social cost of pollution;optimal tax rate

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Definitions:

Supply Elasticity

A measure of how much the quantity supplied of a good changes in response to a change in price.

Equilibrium Price

The equilibrium price where the supply of goods meets consumer demand.

Horizontal Supply Curve

Represents a market situation where the supply of a good is perfectly elastic, indicating the supplier is willing to sell any quantity at a fixed price.

Linear

A straight-line relation in mathematics that expresses a constant rate of increase or decrease between variables.