Direct Controls Are Generally Much More Costly Than Emissions Taxes

question 36

Multiple Choice

Direct controls are generally much more costly than emissions taxes because

• A)under direct controls emissions cutbacks are usually not apportioned among the firms on the basis of their ability to reduce pollution cheaply and efficiently.
• B)emissions tax per unit of output is higher than the per-unit direct control program cost.
• C)government cannot legally levy emissions taxes that are as high.
• D)firms disregard emissions taxes.

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Definitions:

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