Which of the Following Is Not a Solution to the Problem

question 199

Multiple Choice

Which of the following is not a solution to the problem of negative externalities due to pollution?

• A) Create private property rights.
• B) Levy pollution taxes.
• C) Create obligatory controls.
• D) Reward the production of these products through subsidies.
• E) Establish strict limits on the amount of pollution allowed.

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Definitions:

Perfectly Inelastic

A situation in market demand or supply where the quantity demanded or supplied does not change regardless of changes in price.

Equilibrium Price

The price at which the quantity of a good or service demanded equals the quantity supplied, leading to a state of balance in the market.

Equilibrium Quantity

The amount of goods or services supplied that is exactly equal to the amount of goods or services demanded at a particular price level.

Demand

The total amount of a product or service that consumers are willing and able to purchase at various price levels at a given time.