When One Firm Sells Its Pollution Permit to Another Firm

question 450

Multiple Choice

When one firm sells its pollution permit to another firm,

• A)both firms benefit.
• B)the total amount of pollution remains the same.
• C)the total amount of pollution decreases.
• D)Both a and b are correct.

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Definitions:

Demographic Transition

A model that describes the transformation of a society from high birth and death rates to low birth and death rates as a country develops from a pre-industrial to an industrialized economic system.

Renewable Resources

Natural resources that can be replenished naturally over short periods of time, such as solar energy, wind, and water.

Nonrenewable Resources

Nonrenewable resources are natural resources that cannot be replenished or replaced at the same rate at which they are consumed, such as oil, coal, and natural gas.

Placebo Effect

A beneficial effect produced by a placebo drug or treatment, which cannot be attributed to the properties of the placebo itself, and must therefore be due to the patient's belief in that treatment.