In setting an obligatory control on a polluting industry, the government
A) places a tax on the pollution
B) creates pollution permits which could be sold on the open market
C) creates private property rights for air
D) establishes a limit on the amount of pollution a producer is permitted to emit
E) offers a subsidy to the polluting firm

Question

Quizplus · Accepted Answer

Establishing a limit on the amount of pollution a producer is permitted to emit directly sets an obligatory control, as it mandates a maximum level of pollution output, unlike the other options which involve economic incentives or market-based mechanisms.

In Setting an Obligatory Control on a Polluting Industry, the Government