Tradable Pollution Permits,when Compared to Command-And-Control Options,tend to

question 66

Multiple Choice

Tradable pollution permits,when compared to command-and-control options,tend to

• A)Provide the same amount of pollution abatement at a higher cost.
• B)Provide the same amount of pollution abatement at a lower cost.
• C)Provide the same amount of pollution abatement at the same cost.
• D)Be inefficient.

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Definitions:

Negative Externality

A cost suffered by a third party due to an economic transaction, without compensation.

After-Tax Equilibrium

The balance reached in the market after accounting for the effects of taxes.

Socially Optimal Quantity

The level of output or production that maximizes societal welfare, taking into account all external costs and benefits.

Equilibrium Price

The price at which the quantity of a good or service demanded by consumers equals the quantity supplied by producers, resulting in a stable market condition.