If a Corrective Tax on Gasoline Results in the Efficient

question 117

Multiple Choice

If a corrective tax on gasoline results in the efficient output of gasoline by internalizing the negative externalities associated with pollution,then

• A) pollution from gasoline will increase.
• B) there will be no effect on pollution from gasoline.
• C) pollution from gasoline will be zero.
• D) pollution from gasoline will decrease.
• E) pollution from gasoline will either increase or remain the same.

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Definitions:

Environmental Costs

The negative impacts on the environment due to industrial processes, consumption patterns, or other human activities, often quantified in economic terms.

Virgin Materials

Raw materials that have never been processed or used before, often extracted directly from the Earth.

Hazardous Wastes

Hazardous wastes are materials that are dangerous or potentially harmful to people's health or the environment, often requiring special handling and disposal procedures.

Less-Hazardous Substances

Chemicals or materials that pose a lower risk to human health and the environment compared to their more dangerous counterparts.