The Equilibrium Permit Price of a Pollution Right Is _______

question 140

Multiple Choice

The equilibrium permit price of a pollution right is _______

• A)determined by the consumers consuming the products of the polluting firms.
• B)determined by the government.
• C)determined by the municipal corporation of the area.
• D)determined by the supply of and the demand for pollution rights.
• E)determined by the marginal social costs of the products of the polluting firms.

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Definitions:

Price Floor

A government- or authority-set minimum price for certain goods or services, aimed at preventing prices from falling below a certain level.

Black Markets

Illegal trading of goods and services that occurs outside the official channels sanctioned by authorities.

Price Ceilings

An imposed limit on the price charged for a product or service, often set by government regulation to protect consumers from excessively high prices.

Market Intervention

Market intervention is the action taken by a government or a regulatory authority to affect the market for a particular good or service, typically to correct market failures.