In Some Industries, Pollution Rights Are Sold from One Company

question 32

Multiple Choice

In some industries, pollution rights are sold from one company that does not need them to another that does. In recent years, conservation groups have purchased pollution rights so they cannot be exercised. Companies in need of pollution rights would find that:

• A) the supply of pollution rights had increased.
• B) the prices of pollution rights had fallen.
• C) the relative costs of pollution control equipment had gone up.
• D) the supply of pollution rights had declined.

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Definitions:

Special Duties

Obligations that are unique to certain relationships or positions, often implying a higher standard of conduct.

Self-Interest

In economics and psychology, it refers to actions that are primarily intended to benefit oneself.

Nonfraudulent Representation

Any statement or declaration that is truthful and not intended to deceive or mislead.

Scienter

A legal term referring to the knowledge of wrongdoing or fraudulent intent in actions that lead to litigation, particularly in securities fraud.