When Tradable Allowances Are Used to Correct a Negative Externality

question 89

Multiple Choice

When tradable allowances are used to correct a negative externality in a market, the outcome:

• A)limits the quantity bought and sold to the efficient level.
• B)maximizes surplus.
• C)is efficient.
• D)All of these are true.

---

Definitions:

Values

Core beliefs or principles that guide and motivate attitudes and actions in individuals and organizations.

Norms

The informal understandings that govern the behaviors of members of a society or group, often guiding acceptable and expected actions.

Knowledge Management

The process of capturing, developing, sharing, and effectively using organizational knowledge.

Capturing

Involves the process of obtaining and securing something of interest or value, often used in contexts like data capture or wildlife conservation.