Suppose There Will Be Global Catastrophe Unless We Hold Total

question 161

Multiple Choice

Suppose there will be global catastrophe unless we hold total carbon dioxide emissions at or below 35 million tons per year. As a result, each person on Earth is allocated 10 pounds of untradable emissions permits per year. Why would this be an inefficient solution?

• A) Flexibility is not desirable.
• B) Transaction costs are very high.
• C) Everybody has the same cost of emissions abatement.
• D) Different people have different costs of emissions abatement.

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Definitions:

Environment

The sum of all external conditions and influences affecting the life and development of organisms, including natural and built environments.

Need to Belong

An inherent human drive to form and maintain strong, stable interpersonal relationships.

Proximity Effect

The phenomenon where individuals become more attracted or feel closer to those who are physically nearer to them.

Relationships

Connections or associations between two or more people, which can vary in intensity and importance.