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The government auctions off 500 units of pollution rights. They sell for $50 per unit, raising total revenue of $25,000. This policy is equivalent to a corrective tax of ___________ per unit of pollution. a. $10 b. $50 c. $450 d. $500
Chapter 10, Problem 5(choose chapter or problem)
The government auctions off 500 units of pollution rights. They sell for $50 per unit, raising total revenue of $25,000. This policy is equivalent to a corrective tax of ___________ per unit of pollution.
a. $10
b. $50
c. $450
d. $500
Questions & Answers
QUESTION:
The government auctions off 500 units of pollution rights. They sell for $50 per unit, raising total revenue of $25,000. This policy is equivalent to a corrective tax of ___________ per unit of pollution.
a. $10
b. $50
c. $450
d. $500
ANSWER:Step 1 of 2
Given data:
The government auctions off 500 units of pollution rights. They sell for $50 per unit, raising total revenue of $25,000. Governments across the world use a variety of policy instruments to regulate negative externalities. The most important negative externality that has been witnessed around the world is pollution.