a.
air pollution has worsened in most U.S. cities.
b.
many new pollutants have been introduced or identified.
c.
the federal government has reduced its reliance on economic incentives as a means of reducing pollution.
d.
All of the above are correct.
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
74. China, the last large communist society,
a.
has proved that a command economy has far less pollution problems than capitalist economies.
b.
has urban smog levels higher than Los Angeles.
c.
has the world’s most sophisticated pollution-control devices.
d.
has lowered its level of pollution dramatically since 1980.
Easy
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
75. In Eastern Europe and the countries of the former Soviet Union,
a.
grave environmental problems plague Eastern Europe.
b.
the area suffers from widespread illness and countless premature deaths.
c.
the Aral Sea, once the world’s fourth-largest inland sea, is now half its previous size.
d.
All of the above are correct.
Easy
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
76. There has been a downward trend in the United States since 1980 in the ambient concentrations of
a.
sulfur dioxide.
b.
carbon monoxide.
c.
lead.
d.
all of the above.
77. Many of the new pollutants to which the world has been subjected are
a.
less visible.
b.
less malodorous.
c.
far more dangerous.
d.
All of the above are correct.
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
78. Global warming of the past century, and especially in the past decade, is at least partly a consequence of human
activities that have increased ____ in the atmosphere.
a.
smog
b.
PCBs
c.
ozone
d.
“greenhouse gases”
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
79. Recycling in the United States in recent years
a.
has decreased in spite of increased rates for common recycling materials.
b.
has remained unchanged, and increased raes for recycling may help.
c.
has increased with increased rates for recycling mterials.
d.
has increased with no help from increased fees for recycling materials.
c
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
80. Between 1980 and 2008 recycling in the United States has
a.
decreased by less than 2%.
b.
increased by less than 2%.
c.
doubled.
d.
tripled.
Easy
DISC: Measuring the Economy
United States – BPROG: Analytic
Measuring the Economy
Review-Externalities: A Critical Shortcoming of the Market Mechanism
81. Major contributors to pollution are
a.
individuals.
b.
firms.
c.
government.
d.
All of the above are correct.
Easy
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
82. Individuals play ____ in causing pollution.
a.
almost no role
b.
a large but decreasing role
c.
a major role
d.
a reconstructive role
c
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
83. Contrary to most thinking, governments play ____ in causing pollution.
a.
almost no role
b.
a large but decreasing role
c.
a major role
d.
a reconstructive role
c
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
84. By the year 2100, global warming may lead to
a.
shifts in world rain patterns.
b.
disruption of agriculture.
c.
expanded deserts.
d.
coastal inundation.
e.
all of the above
e
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
85. Who of the following has been prominently accused of acting on the basis of the “edifice complex?”
a.
the Environmental Protection Agency?
b.
A. C. Pigou
c.
the Army Corps of Engineers
d.
environmental activists
c
Easy
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
86. Economists consider environmental pollution to be a(n)
a.
externality.
b.
pure public good.
c.
allocatively efficient outcome.
d.
public interest outcome.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
87. One of the reasons that pollution problems are as large as they are is that
a.
markets let individuals and firms deplete valuable resources without charging money for doing so.
b.
markets are incapable of incorporating valuable resources such as air and pure water.
c.
governments use resources without paying for them the way that individuals and firms must.
d.
markets are not an efficient means to address scarcity.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
88. Externalities are commonly generated from
a.
purely competitive retail industries.
b.
modern computer technologies.
c.
ordinary consumption and production activities.
d.
benefits from further pollution abatement, which are zero.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
89. Under a system of financial penalties for polluters:
a.
Firms could pollute all they wanted to.
b.
Firms would have to pay a tax for each unit of pollution created.
c.
Firms would be encouraged to pollute less.
d.
All of the above are correct.
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
90. Regarding the causes of pollution, economists believe that:
a.
the pricing system has failed.
b.
the public interest requires that pollution to be reduced below its market level.
c.
a firm pollutes the air and water because they are free.
d.
All of the above are correct.
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Reflective Thinking – BPROG: Analysis
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
91. The use of chlorofluorocarbons in refrigerators and air conditioners is alleged to cause the destruction of the ozone
layer that surrounds the earth and which protects humans from ultraviolet radiation. Output of this substance has been
restricted by a licensing system where producers have to bid in the open market for licenses to produce them in specified
quantities. This is an example of dealing with externalities by
a.
voluntary compliance.
b.
direct controls.
c.
taxes.
d.
the market mechanism.
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
92. Environmental damage
a.
cannot be reduced to zero.
b.
is inevitable where humans exist.
c.
tends to increase as long as benefits outweigh the costs to the damagers.
d.
All of the above are correct.
Easy
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
93. Which of the following observations is true?
a.
Environmental damage can be reduced to zero.
b.
Pollution results from a price mechanism malfunction.
c.
Charging those who emit pollution is not a way of dealing with pollution problems.
d.
Public interest requires pollution be maintained at its free-market level.
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
BLOOM’S: Comprehension
94. Externalities can cause the market mechanism to
a.
malfunction.
b.
improve.
c.
operate efficiently.
d.
move up toward the production possibility curve.
a
Easy
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
95. Environmental quality is
a.
a public good.
b.
best improved through government’s prohibiting externalities.
c.
maximized when costs of pollution are external.
d.
minimized when optimal levels of pollution are produced.
a
Difficult
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Reflective Thinking – BPROG: Analysis
Markets, market failure, and ext – Markets, market failure, and externalities
Review-Externalities: A Critical Shortcoming of the Market Mechanism
96. Supply and demand analysis
a.
can be used to understand solutions to pollution, but not causes.
b.
can be used to analyze how externalities lead to environmental problems.
c.
cannot be used to analyze pollution, which is a physical and chemical problem.
d.
cannot be used to solve the pollution problem, but can be used to analyze it.
DISC: Supply and demand
United States – BPROG: Analytic
Supply and demand
Basic Approaches to Environmental Policy
97. Cleaning an environment may lead to
a.
less production.
b.
higher prices.
c.
lower incomes.
d.
all of the above.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
98. A firm producing a smoke externality is producing
a.
more than the socially optimal quantity of output.
b.
less than the socially optimal quantity of output.
c.
exactly the socially optimal quantity of output.
d.
There is insufficient information to answer.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Reflective Thinking – BPROG: Analysis
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
99. If suppliers of garbage collection services charged the full costs of providing the service, the supply curve would
a.
change to a positive slope.
b.
change to a negative slope.
c.
shift to the left.
d.
shift to the right.
DISC: Supply and demand
United States – BPROG: Reflective Thinking – BPROG: Analysis
Supply and demand
Basic Approaches to Environmental Policy
100. The share of the burden of an emissions tax on output borne by the consumer of the polluting output will rise as
a.
the tax rises.
b.
demand elasticity falls.
c.
demand elasticity rises.
d.
the tax falls.
DISC: Supply and demand
United States – BPROG: Analytic
Supply and demand
Basic Approaches to Environmental Policy
101. The external costs of alcohol consumption are related to, among other things, death and injury related to auto
accidents caused by drunk drivers. These costs have been estimated to be about 47 cents per ounce of alcohol consumed.
Taxes on alcohol amount to 23 cents per ounce. This suggests that alcohol consumption is (i) greater than the efficient or
optimal amount; (ii) should be reduced to zero to eliminate the externality.
a.
i and ii
b.
i not ii
c.
ii not i
d.
neither i nor ii
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
102. The external costs of cigarettes are related to the health problem smoking produces for both smokers and
nonsmokers. One estimate places these costs at 29 cents per pack. Presently, sales and excise taxes on cigarettes average
about 37 cents per pack. These estimates suggest that (i) cigarette consumption is below the optimal or efficient quantity;
(ii) cigarette taxes should be reduced.
a.
i and ii
b.
i but not ii
c.
ii but not i
d.
neither i nor ii
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Reflective Thinking – BPROG: Analysis
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
103. By providing free garbage removal, a community
a.
discourages activities that produce detrimental externalities.
b.
encourages citizens to recycle items rather than throw them out.
c.
leads citizens to throw out more garbage than is socially optimal.
d.
None of the above is correct.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
104. Part of the pollution problem is due to
a.
the absence of markets for goods like clean air and clean water.
b.
the lack of well-defined property rights to clean air and clean water.
c.
the unreliability of voluntary programs to cut pollution.
d.
All of the above are correct.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Reflective Thinking – BPROG: Analysis
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
105. If the price of garbage removal rises, people will
a.
demand a lesser quantity of garbage removal.
b.
take more waste to recycling centers.
c.
repair broken items rather than throwing them out.
d.
All of the above are correct.
Easy
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Reflective Thinking – BPROG: Analysis
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
106. The position of the supply curve in the market for garbage removal
a.
is irrelevant since the cost is fixed.
b.
depends on the marginal cost of garbage removal.
c.
depends on the demand for garbage removal services.
d.
is unaffected by taxes levied per household amount of garbage.
Moderate
DISC: Supply and demand
United States – BPROG: Analytic
Supply and demand
Basic Approaches to Environmental Policy
107. Wastes impose costs upon the community if they are
a.
solid.
b.
liquid.
c.
gaseous.
d.
any of the above.
Easy
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
108. Voluntary programs for reducing pollution
a.
have been more successful in the United States in encouraging recycling than any other type of program.
b.
are most appropriate when surveillance and enforcement are impractical.
c.
work most reliably when voluntary reduction of pollution over a long period is encouraged.
d.
are enforced by legal authority.
Moderate
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
109. Which basic approach to environment policy may be the only workable solution in brief but serious emergencies that
do not allow for time to plan and enact a systematic program?
a.
Taxes on pollution
b.
Voluntary compliance
c.
Tradable emissions permits
d.
Direct controls like legal ceilings
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
110. Voluntarism as an approach to environmental problems
a.
has no place at all in solving the problems.
b.
is quite successful in reducing pollution.
c.
is more effective than first meets the eye.
d.
often has proved weak and unreliable.
United States – BPROG: Analytic
The study of economics, and defi – The study of economics, and definitions of economics
Basic Approaches to Environmental Policy
111. Suppose that because of climatic conditions, the smog levels in Los Angeles suddenly soar to dangerous levels. The
most successful policy in this case would be
a.
direct controls to limit driving.
b.
taxes on drivers at rush hours.
c.
voluntary cooperation to reduce driving.
d.
removal of autos with excessive emissions.
United States – BPROG: Analytic
The study of economics, and defi – The study of economics, and definitions of economics
Basic Approaches to Environmental Policy
112. Which of the following is an advantage to the pollution-rights approach to environmental quality?
a.
Polluters are compelled to clean up completely.
b.
Polluters have appropriate incentives to clean up.
c.
This is a method of direct government regulation.
d.
Compliance with legal guidelines is discretionary.
DISC: The role of incentives
United States – BPROG: Reflective Thinking – BPROG: Analysis
The role of incentives
Basic Approaches to Environmental Policy
113. Voluntarism includes methods for dealing with pollution that
a.
carry no legal authority.
b.
call the problems of pollution to the public’s attention.
c.
involve trying to persuade polluters to reduce or eliminate pollution voluntarily.
d.
include all of the above.
United States – BPROG: Analytic
The study of economics, and defi – The study of economics, and definitions of economics
Basic Approaches to Environmental Policy
114. Voluntarism in recycling garbage
a.
generally has not been successful.
b.
works only where there is surveillance.
c.
increases the cost of recycling waste.
d.
has worked best of all recycling program alternatives.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
115. To protect the environment, governments in the United States have mainly used
a.
legally enforceable direct controls on pollution.
b.
taxes on goods whose production creates pollution.
c.
direct taxes on emissions.
d.
discretionary guidelines suggested to polluting firms.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
116. ____ has(have) traditionally been the chief instrument of environmental policy in the United States.
a.
Taxes on pollution
b.
Voluntary compliance
c.
Tradable emissions permits
d.
Direct controls
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
117. Which of the following has also been called the command and control approach?
a.
Direct controls
b.
Voluntary compliance
c.
Tradable emissions permits
d.
Taxes on pollution
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
118. In North Carolina, a car must pass an emissions test before it can be registered. The emissions test costs $20 per car.
This system is an example of
a.
direct controls on pollution.
b.
a per-unit emissions tax.
c.
a “license to pollute.”
d.
subsidies for nonpollution.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
119. The legal system imposes large financial penalties on firms caught violating Environmental Protection Agency
guidelines. The EPA’s standards program is thus an example of a
a.
market-based approach to reducing pollution.
b.
system of emissions taxes.
c.
system of emissions permits.
d.
direct-control system enforced through the courts.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
120. Most economists agree that exclusive reliance on direct controls
a.
is a sound approach.
b.
has worked well for us in the past.
c.
is cheaper than any other enforcement mechanism.
d.
is a mistake.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
121. Direct controls on polluting activity
a.
have never been tried as an instrument of environmental policy.
b.
have been the chief instrument of environmental policy.
c.
have been rejected as a tool of environmental policy.
d.
are the tool of future environmental policy, based on 1993 legislation.
Easy
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
122. During the second Bush administration, environmental fines and prosecutions
a.
increased rapidly.
b.
declined significantly.
c.
grew with the rate of inflation.
d.
declined slightly from earlier levels.
Easy
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
123. The effectiveness of direct controls on pollution depends on: (i) the budgets and enthusiasm of the regulatory bodies;
(ii) sufficiently strong statutory penalties.
a.
i and ii
b.
i but not ii
c.
ii but not i
d.
neither i nor ii
a
Easy
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
124. Prohibiting the use of “dirty” fuels by industry is an example of
a.
voluntarism.
b.
direct controls.
c.
taxes on emissions.
d.
none of the above.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
125. Taxes on polluting firms for pollution are intended to
a.
raise enough revenue to cut the deficit in half.
b.
encourage firms to reduce charges by polluting less.
c.
be efficient, i.e., result in no excess burden.
d.
raise revenue for general spending needs.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
126. Taxes on polluting firms have
a.
been tried, but not successfully.
b.
been successful in Germany in reducing water pollution.
c.
resulted in bankruptcy of the affected firms.
d.
never been tried to see if they work.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
127. Statistical studies suggest that the cost of direct controls for any target level of pollution is
a.
much higher than the cost of taxes on emissions.
b.
about the same as the cost of taxes on emissions.
c.
lower than the cost of taxes on emissions.
d.
impossible to compare to the cost of taxes on emissions.
DISC: Markets, market failure, a – DISC: Markets, market failure, and externalities
United States – BPROG: Analytic
Markets, market failure, and ext – Markets, market failure, and externalities
Basic Approaches to Environmental Policy
128. A tax on polluting emissions will
a.
provide incentives for firms to reduce the volume of polluting materials.
b.
raise revenue sufficient to eliminate the deficit.
c.
necessarily lower the price of the products.
d.
require no agency to administer the tax.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
129. Taxes on polluting emissions are
a.
more efficient than direct controls.
b.
used by all economic societies.
c.
less effective than direct regulations.
d.
easily enforced through the criminal justice system.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
130. The use of tax penalties to control pollution represents a
a.
price-based market approach to the pollution problem.
b.
non-market approach to the pollution problem.
c.
major source of current federal revenues.
d.
pollution-rights solution to the pollution problem.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
131. In practice, taxes on emissions of pollutants have been found to
a.
be ineffective in encouraging firms to pollute less.
b.
significantly reduce pollution by taxed firms.
c.
be less reliable in reducing pollution than direct controls on pollution.
d.
cause failures of the pricing system.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
132. Many economists argue that the most efficient way to control pollution is to
a.
ban all activities that create pollution.
b.
enforce legal standards on air and water quality.
c.
promote environmental awareness among citizens.
d.
impose taxes on emissions.
DISC: The role of government
United States – BPROG: Analytic
The role of government
133. Taxes on emissions have led to
a.
extraction of pollutants by firms from their liquid discharges.
b.
recycling of pollutants in lieu of discharge as waste.
c.
voluntary reduction in emissions to avoid the taxes.
d.
all of the above.
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
134. Under an emissions tax program, the government sets ____; under an emissions permits program, the government
sets ____.
a.
the price of the right to pollute; the price of the right to pollute
b.
the price of the right to pollute; the permitted total quantity of pollution
c.
the permitted total quantity of pollution; the price of the right to pollute
d.
the permitted total quantity of pollution; the permitted total quantity of pollution
DISC: The role of government
United States – BPROG: Analytic
The role of government
Basic Approaches to Environmental Policy
135. Empirical evidence indicates that imposing taxes on polluting emissions by firms
a.
has no effect on the amount of pollution emitted.
b.
does not give the government leeway to regulate more dangerous emissions differently than less dangerous
emissions.
c.
does reduce the amount of pollution emitted.
d.
discourages firms from investing in new methods of pollution abatement.
DISC: The role of incentives
United States – BPROG: Analytic
The role of incentives
Basic Approaches to Environmental Policy
136. Taking advantage of the built-in-loophole in emission taxes implies
a.
opportunity to save on taxes by reducing emissions.
b.
opportunity to avoid taxes even without cutting emissions.
c.
opportunity to increase emission by paying more tax.
d.
opportunity to pay less by increasing emission.
DISC: The role of incentives
United States – BPROG: Analytic
The role of incentives
Basic Approaches to Environmental Policy
137. Regulations that strictly limit pollution
a.
provide firms no incentives to reduce pollution once a standard is met.
b.
provide incentives for firms to discover loopholes in the regulations.
c.
tend to be economically inefficient ways to reduce pollution.
d.
All of the above are true.