Asked by Juliana Gallego on Apr 28, 2024
Verified
If an emissions tax is too low:
A) there will be too little pollution.
B) there will be too much pollution.
C) the marginal social cost of pollution will be less than the marginal social benefit of pollution.
D) there could be either too much or too little pollution.
Emissions Tax
A tax that depends on the amount of pollution a firm produces.
Marginal Social Cost
The additional cost to society as a whole from producing one more unit of a good or service.
- Evaluate the efficacy of emissions taxes and their potential consequences on pollution levels.
Verified Answer
KF
Keith FitzpatrickApr 29, 2024
Final Answer :
B
Explanation :
If an emissions tax is set too low, it does not provide enough of a financial disincentive for polluters to reduce their emissions, leading to too much pollution.
Learning Objectives
- Evaluate the efficacy of emissions taxes and their potential consequences on pollution levels.
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