Which of the following is not a solution to the problem of negative externalities due to pollution?
A)Create private property rights.
B)Levy pollution taxes.
C)Create obligatory controls.
D)Reward the production of the products through subsidies.
E)Establish strict limits on the amount of pollution allowed.

Question

Quizplus · Accepted Answer

Rewarding the production of products through subsidies will actually encourage firms to produce more, which may result in even more pollution. Therefore, it is not a solution to the problem of negative externalities due to pollution.

Which of the Following Is Not a Solution to the Problem