The EPA's System of Tradable Allowances

question 256

Multiple Choice

The EPA's system of tradable allowances:

• A) was unable to internalize the external costs of pollution.
• B) actually lead to increased levels of pollution.
• C) was moderately successful in helping to decrease pollution levels.
• D) is a successful application of the Coase theorem.

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Definitions:

Net Income

The final earnings tally for a company after subtracting all costs and tax charges from its revenue total.

Adjusting Entry

A journal entry made at the end of an accounting period to record revenues and expenses in the period in which they actually occurred.

Supplies Expense

Represents the cost of supplies used during an accounting period, differentiating from supplies bought but not yet used.

Net Income

The total profit or loss of a company after all expenses, taxes, and costs have been deducted from total revenue, a key indicator of financial performance.