In Which of the Following Situations May Tradeable Pollution Permits

question 53

Multiple Choice

In which of the following situations may tradeable pollution permits be preferred to Pigovian taxes?
(i) where they internalise the externality of pollution
(ii) where regulatory agencies do not know the demand curve for pollution
(iii) where the government is not interested in generating maximum revenue from polluting firms

• A)(i) only
• B)(ii) only
• C)(ii) and (iii) only
• D)(i), (ii) and (iii)

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Definitions:

Opposition

The movement of the thumb to touch the tips of the other fingers on the same hand, enabling grasping and manipulation of objects.

Adduction

The movement of a body part toward the central axis of the body or toward another part, as in bringing arms or legs closer to the torso.

Lateral Flexion

A movement that bends the spine sideways to the left or right.

Hyperextension

An excessive extension of a limb or part beyond its normal limit, often resulting in injury.