The Major Difficulty with Using a Tax on Pollution Instead

question 160

Multiple Choice

The major difficulty with using a tax on pollution instead of a fixed-percentage reduction regulation is

• A) non-payment of the tax.
• B) establishing the optimal size of the tax.
• C) that the public would not accept it as a viable solution.
• D) that it only works in theory.
• E) that it would cause prices to rise.

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Definitions:

Offshoring

The practice of shifting work previously done by domestic workers to workers located abroad.

Trading Partner

A country or organization which engages in international trade with another entity, typically exchanging goods, services, or information.

Comparative Advantage

The ability of a country or firm to produce a particular good or service at a lower opportunity cost than its trading partners, forming the basis of international trade.