An effluent fee is an example of
A) a government policy to correct for an external benefit.
B) a government policy to promote the production of a product with an external cost.
C) a government policy to promote the production of a product with an external benefit.
D) a government policy to correct for an external cost.

Question

Quizplus · Accepted Answer

An effluent fee is a charge levied by the government on a company or factory that releases pollutants or wastes into the environment. This fee is supposed to help correct for the external cost of pollution, which is a negative consequence of the company's activities that is borne by society as a whole rather than by the company itself.

An Effluent Fee Is an Example of