Which of the Following Is Not a Reason Why Marketable

question 56

Multiple Choice

Which of the following is not a reason why marketable permits may fail to achieve efficiency?

• A) Some firms can reduce emissions at a lower cost than other firms.
• B) A market with a small number of buyers and sellers.
• C) Imperfect information exists on the value of a permit.
• D) There are concerns about the value of permits in the future.

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Definitions:

Production Possibility Frontier

A curve depicting the maximum possible output combinations of two goods that can be produced with available resources and technology.

Economic Growth

The increase in the inflation-adjusted market value of the goods and services produced by an economy over time, typically measured as the percent rate of increase in real gross domestic product (GDP).

Capital Stock

Refers to the total amount of physical goods and financial assets owned by a company that are used in producing goods or services.

Capital Production

The process of creating goods and services through the combination of labor, land, and capital.