What is the difference between a corrective tax and pollution permits
A)A corrective tax sets the price of pollution, and permits set the quantity of pollution.
B)A corrective tax provides a more efficient outcome than permits.
C)A corrective tax sets the quantity of pollution, and permits set the price of pollution.
D)Permits provide a more efficient outcome than a corrective tax.

Question

Quizplus · Accepted Answer

The key difference between corrective taxes and pollution permits is that a corrective tax sets the price of pollution, while pollution permits set the quantity of pollution. Corrective taxes are taxes levied on companies or individuals who produce pollution, with the aim of reducing the amount of pollution produced. Pollution permits, on the other hand, are rights to emit a certain amount of pollution, which can be bought or sold in a market. While both policies aim to reduce pollution, they work in slightly different ways.

What Is the Difference Between a Corrective Tax and Pollution