What Is the Difference Between Command-And-Control Policies and Market-Based Policies

question 147

Multiple Choice

What is the difference between command-and-control policies and market-based policies toward externalities?

• A)Command-and-control policies provide incentives for private decisionmakers to solve the problems on their own, whereas market-based policies regulate behavior directly.
• B)Command-and-control policies rely on taxes, whereas market-based policies rely on quotas.
• C)Command-and-control policies regulate behavior directly, whereas market-based policies provide incentives for private decisionmakers to change their behavior.
• D)Command-and-control policies are efficient, whereas market-based policies are inefficient.

---

Definitions:

GDP

Summarizing the value of all final goods and services made within a country's borders in monetary or market terms during a specific time frame is what Gross Domestic Product is about.

GDP Deflator

A metric that assesses the prices of all new, internally produced final goods and services in an economic system, employed in the adjustment of nominal GDP to real GDP.

Real GDP

Real Gross Domestic Product (Real GDP) measures the value of all finished goods and services produced within a country's borders in a specific period, adjusted for inflation.

GDP

The total value of all produced goods and services within a country over a particular time period is what Gross Domestic Product (GDP) measures.