Tennessee emits sulfur dioxide that flows into North Carolina. In meeting sulfur emissions regulations, the Tennessee Valley Authority (TVA), which produces electricity, buys sulfur emission permits from Wyoming. The resulting hot spot problem is:
A. The citizens of Wyoming will experience higher sulfur emissions as a result of the emissions trading program.
B. The citizens of Wyoming will experience lower sulfur emissions as a result of the emissions trading program.
C. The citizens of Tennessee will pay more to reduce sulfur emissions than if the government used a command-and-control approach.
D. The citizens of North Carolina will suffer higher emissions as a result of the emissions trading program.
Answer: D
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Some resources are private and others are common. Define a common resource, explain the definition, and provide an example of a private resource and a common resource
What will be an ideal response?
Education confers positive externalities because
a. some education is done outside the market (i.e., in public schools) b. curricula are regulated by the government, even in private schools c. an educated person consuming education gains many benefits he or she did not expect when the process started d. an educated person who has consumed education usually behaves in a way that benefits others e. education gives benefits to individuals in excess of the costs they pay to get it