5. Which of the following best describes the issuance of permits to pollute as a way of influencing the amount of pollution? Permits to pollute: a. encourage business to pollute.b. should be purchased by those whose pollution is the least expensive to eliminate.c. should be purchased by those whose pollution is the most expensive to eliminate.d. are preferable over taxes because they can be limited to exactly the efficient amount of pollution.

noint(s Next question The Coase theorem states that A. the best way to limit pollution is by taxing producers who pollute. B. if property rights exist and transactions costs are low, private transactions are efficient. C. profit making producers pollute because they are forced to. D. the level of pollution should be equal to zero to maximize social net benefit. E. the efficient level of output is where marginal external cost equals marginal external benefit.

1. List some of the ways that the problems caused by externalities can be solved without government intervention.

The optimal level of pollution is O the level that has no effect on the environment. O found where the marginal cost of pollution equals the marginal benefit. found where the marginal benefit of pollution is maximized. O found where the total cost of pollution equals the total benefit. zero.

8.1 Suppose we have an agricultural valley 100 km by 50 km, with a polluting electricity power plant. The power plant causes pollution problems in a narrow strip of land downwind of the plant, and within this valley. 10 km in length and 500 m in width, but no problems outside of that area. The total effect of the pollution is to make crop land less productive. If we were to clean up the pollution, would we expect land prices to increase? Where? Would we expect wages to decline? Would the changes in land prices and/or wages fully reflect the benefits of cleaning up the pollution? Why or why not?

1. A cap-and-trade scheme with the cap equal to efficient level of pollution _______.A. Leads to the price of a permit = MEC and achieves an efficient outcome.B. leads the price of a permit = MPC and achieves an efficient outcome.C. Leads to the price of a permit = MSC and achieves an efficient outcomeD. minimizes the cost of controlling pollution to the desired (efficient) level. E. A and D.

Suppose electricity generates a negative externality in production If​ so, then   A. the marginal social cost of electricity is less than the marginal private cost .   B. the marginal social cost of electricity equals the marginal private cost .   C. the marginal social benefit of electricity is less than the marginal private benefit .   D. the marginal social cost of electricity equals the marginal social benefit.   E. the marginal social cost of electricity is greater than the marginal private cost.

a. Jerome has a beautifully landscaped front lawn with lots of colorful flowers. Landscaped lawns produce a landscaped lawns exist relative to the socially efficient quantity. externality. b. Dave takes advantage of the low price of gas to purchase a sports utility vehicle. Sports utility vehicles generate a externality. sports utility vehicles are produced relative to the socially efficient quantity. c. Susan decides to walk to work instead of driving. Walking to work creates a walks to work exist relative to the socially efficient quantity. externality. d. Anita decides to smoke a cigarette while she is waiting at a busy bus stop. Cigarettes create a cigarettes are produced relative to the socially efficient quantity. externality.

4. The advantages of command-and-control environmental regulations used in the 1970's include: a. the provision of incentives to go beyond prescribed limits b. great flexibility in how and where to make pollution reductions c. proven success in reducing levels of pollution d. all of the above 6. With regard to international environmental issues, the Openstax text argues that: a. high income countries should use their superior economic position to force low income countries to reduce pollution b. climate change is too important of an issue to leave it to a market-oriented approach for a solution c. the practical details of an international solution are forbiddingly complex d. all of the above 7. According to the Openstax text: a. Increased environmental protection reduces economic output b. Environmental protection measures usually enhance economic output c. Increased environmental protection only reduces economic output in poorer countries d. Environmental protection measures only…

There are three major ferry lines operating in Vancouver, each generating 100 units of pollution per year. The ferry lines face the costs of reducing pollution that are shown in the table below.  Ferry line Cost of reducing pollution by 1 unit A $1,200 B $2,400 C $1,600 a. The BC government has decided it wants to reduce pollution levels by 50 percent and requires each ferry line to cut its pollution in half. Determine the cost of pollution reduction for each ferry line.Instructions: Round your answers to the nearest dollar.  Ferry line Cost of pollution reduction A $  B $  C $      a. The total cost of pollution reduction is $  .b. Suppose the government decides to give each ferry line 50 tradable permits. Each permit allows a ferry line to produce one unit of pollution.    Ferry line  ____ will buy  permits from ferry line ____.c. Under this system of tradable permits, the total cost of pollution reduction is $  .