Taxing Externalities Such as Pollution Provides a Financial Incentive for Firms

question 6

True/False

Taxing externalities such as pollution provides a financial incentive for firms to decrease pollution.

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Definitions:

ΔG°

The change in Gibbs free energy under standard conditions, indicating the spontaneity of a reaction.

Entropy

A measure of disorder or randomness in a system, often associated with the second law of thermodynamics describing the direction of physical processes and energy dispersion.

Randomness

The lack of pattern or predictability in events.

System

A set of interacting or interdependent components forming an integrated whole, often within a scientific or engineering context.