Some environmentalists have criticized tradable emission allowances on the grounds that they give permit holders a license to pollute
Furthermore, environmentalists argue that those who sell their permits receive a monetary benefit from their contribution to polluting the environment. Use economic reasoning to evaluate this criticism.
The criticism ignores one of the central lessons of economics: resources are scarce and trade-offs exist. Resources spent reducing one type of pollution are not available for other uses. Furthermore, the opportunity cost of polluting (using the permit) is the price of the permit. In other words, firms are forced to face the cost of polluting. So although firms receive a monetary benefit from the sale of permits, the scheme gives them the incentive to find the cheapest way to reduce pollution.
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Speculators who expect a corn harvest next fall much larger than anyone now anticipates will
A) lower current corn prices and raise September prices above what they would be in the absence of the speculators. B) lower current corn prices and lower September prices below what they would be in the absence of the speculators. C) raise current corn prices and lower September prices below what they would be in the absence of the speculators. D) raise current corn prices and raise September prices above what they would be in the absence of the speculators. E) raise the expected September price of corn.
A Japanese recession will be counteracted by an appreciation of the Japanese yen
a. True b. False Indicate whether the statement is true or false