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An emissions tax on a quantity of emissions from a firm is not a command-and-control approach to reducing pollution. Why?

a. It imposes a penalty on the firm
b. It allows the firm to decide its emission reduction method
c. It directly dictates emission reduction methods
d. It doesn’t influence the firm’s behavior toward pollution reduction

User Tereza
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Final answer:

An emissions tax on a quantity of emissions from a firm is not a command-and-control approach to reducing pollution because it allows the firm to decide its emission reduction method.

Step-by-step explanation:

An emissions tax on a quantity of emissions from a firm is not a command-and-control approach to reducing pollution because it allows the firm to decide its emission reduction method. With an emissions tax, the government sets a price on each unit of pollution emitted. This gives the firm the flexibility to choose how they reduce their emissions based on what is most cost-effective for them, as long as they stay within the total emissions limit.

For example, if a firm faces an emissions tax of $10 per unit of pollution, they may choose to invest in more efficient technology or change their production processes to emit less pollution. This approach incentivizes firms to find the least expensive methods of reducing pollution, which can lead to more innovation in pollution reduction strategies.

On the other hand, a command-and-control approach would directly dictate emission reduction methods to firms, such as specifying the use of certain technologies or setting specific emission limits for each firm. This approach may provide less flexibility and limit the ability of firms to find innovative solutions to reduce pollution.

User Mark Denn
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