Economists generally prefer to deal with emissions of pollutants
A)with direct controls.
B)by encouraging people not to pollute.
C)by subsidizing the installation of pollution-control equipment.
D)by taxing emissions.

Question

Quizplus · Accepted Answer

Economists generally prefer to deal with emissions of pollutants by taxing emissions. This is because a tax on pollution creates a cost for pollution and incentivizes firms to reduce their emissions, either by investing in abatement technology or by changing their production processes. It also generates revenue for the government, which can be used to fund environmental projects or to offset other taxes. Direct controls are often seen as less efficient because they don't provide as much flexibility for firms to find the least-cost way to reduce emissions. Encouraging people not to pollute and subsidizing pollution-control equipment may be effective in certain situations, but they may not be as effective at reducing emissions overall.

Economists Generally Prefer to Deal with Emissions of Pollutants