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Question 1 (1 point)
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Market based environmental policies might be more effective since they provide
Question 1 options:
| perfect information about the control measures adopted by the polluters | |
| opportunities to understate emissions levels | |
| cost saving opportunities for the polluters | |
| clearly written rules for control |
Question 2 (1 point)
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Command and control methods were more prevalent till the
Question 2 options:
| 1990s | |
| 1980s | |
| 1970s | |
| present |
Question 3 (1 point)
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Suppose there are two sources of pollution. Source 1’s marginal abatement cost is MAC_1 and Source 2’s marginal abatement cost is MAC_2. If MAC_1 > MAC_2, then,
Question 3 options:
| Source 2 should emit more and Source 1 should control more | |
| Total abatement cost is being minimized | |
| Source 1 should emit more and Source 2 should control more | |
| There is optimal abatement |
Question 4 (1 point)
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Which of the following true about The US Acid Rain Program ? (There could be more than one answers).
Question 4 options:
| The world’s first major application of tradable pollution permits | |
| The program set a permanent cap on sulphur dioxide emissions by US power plants to 40% reduction in annual emissions within a decade | |
| The program set a permanent cap on carbon dioxide emissions by US automobiles to 40% reduction in annual emissions within a decade | |
| The program provided options to reduce emissions and either store permits in banks for future use or sell surplus allowances to other power station operators |
Question 5 (1 point)
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Compared to traditional command and control measures, the US Acid Rain Program
Question 5 options:
| was not as effective | |
| achieved faster and greater reduction in emissions | |
| had practically no impact on the level of emissions reduction | |
| proved to be more costly |
Question 6 (1 point)
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Under the tradable pollution permit system the equilibrium permit price is determined by
Question 6 options:
| state regulations | |
| the EPA | |
| emission levels reduction target | |
| demand and supply of permits |
Question 7 (1 point)
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Which of the following emissions control measures provide incentives for technological innovation for better abatement?
Question 7 options:
| Only emissions trading programs but not emissions charges | |
| Both emissions trading programs and emissions charges | |
| There is no incentive for technological innovation | |
| Command and control measures |
Question 8 (1 point)
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Which of the following pollution control measures has the highest potential to create price volatility?
Question 8 options:
| Command and control | |
| Emissions Charges | |
| None of the above | |
| Emissions Trading |
Question 9 (1 point)
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Under which of the following circumstances does the traditional command and control work better than market bases policies?
Question 9 options:
| If pollution is concentrated in specific areas creating local hot spots | |
| In the presence of high monitoring costs | |
| Traditional methods are always more effective | |
| When the control technology is already being widely used and easily available |
Question 10 (1 point)
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Market based environmental policies are
Question 10 options:
| cost effective but not efficient | |
| cost effective and efficient (that is they minimize deadweight loss) | |
| efficient but not cost effective | |
| results in equal distribution of abatement levels among the sources |
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