multiple choice economics

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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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