When using the economic efficiency approach to controlling air and water pollution, the government
a. forces each firm to produce emissions in the most cost efficient manner irrespective of its cost structure
b. offers each firm the flexibility to reduce emissions in the most cost effective manner, given its unique cost structure
c. offers each firm the option of choosing between the cost minimizing emission level and the profit maximizing emission level
d. provides each firm with some fixed rules and then requires them to maximize profits given these fixed rules
e. offers each firm the option of using marginal cost pricing and average cost pricing when determining the optimum emissions levels
B
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Efficiency in risk bearing implies that
A) risk is completely eliminated. B) the least risk-averse party bears most of the risk. C) the most risk-averse party bears most of the risk. D) all of the risk is borne by just one of the parties regardless of the degree of risk aversion.
Of the following countries, which has the highest level of inequality with respect to disposable income?
A. Chile B. Spain C. Norway D. Germany