Which one of the following helps preserve incentives to develop new technologies?

Although the reciprocal nature of the problem suggest that the proceeds of a corrective tax not be paid to as compensation to those harmed, if compensation is paid to those harmed by externalities _____

a. the payment should be made from general revenues to keep the corrective action separate from the compensatory part b. the payment should be set equal to marginal external cost c. the payment should be made in one lump sum to minimize incentives to create future problems d. the payment should be double the amount of the corrective tax to justly compensate the victims

High interest rates make a firm's long-term investment in new capital

a. riskless. b. less attractive. c. more attractive. d. no more attractive than short-term investment.