When Comparing a System of Emission Taxes to a System

question 24

Multiple Choice

When comparing a system of emission taxes to a system of tradable pollution permits, the same amount of pollution could be abated in each as long as

• A) the marginal cost of abatement was equal across all firms.
• B) the cap on emissions was chosen such that the equilibrium price of the permits, p×, could rise over time.
• C) the emission tax rate, t, was applied equally to all firms.
• D) the marginal benefit of abatement curve was horizontal.
• E) the cap on emissions was chosen such that the equilibrium price of the permits, p×, was equal to the emissions tax rate, t.

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Definitions:

Evangelical Leaders

Influential figures within the evangelical Christian movement known for their emphasis on the necessity of conversion, the authority of the Bible, and active evangelism.

Thomas Jefferson

The principal writer of the Declaration of Independence and a founding father who also served as the third President of the United States.

Declaration Of Independence

Document adopted on July 4, 1776, that made the break with Britain official; drafted by a committee of the Second Continental Congress, including principal writer Thomas Jefferson.

Bill For Establishing Religious Freedom

A Virginia law, drafted by Thomas Jefferson in 1777 and enacted in 1786, that guarantees freedom of, and from, religion.