The Licenses That Are Exchangeable and That Enable the Holder

question 123

Multiple Choice

The licenses that are exchangeable and that enable the holder to pollute up to a specified amount during a given period are called:

• A) emissions taxes.
• B) environmental standards.
• C) tradable emissions permits.
• D) Pigouvian taxes.

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Definitions:

Variable Costs

Costs that change in proportion to the level of production or business activity.

Committed Fixed Costs

Expenses that a company has committed to pay over a period, which do not vary with the level of production or sales.

Depreciation

An accounting method of allocating the cost of a tangible or physical asset over its useful life or life expectancy.

Variable Cost

Expenses that change in proportion to the amount of goods produced or the volume of sales.