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Air pollution is regulated by three levels of government: local, state, and federal.

a) True
b) False

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Final answer:

It is true that air pollution is regulated by local, state, and federal levels. Pollution-control policies can be market incentive based or command-and-control, with examples including emissions taxes and pollution permits for the former, and government requirements and EPA standards for the latter.

Step-by-step explanation:

The original statement 'Air pollution is regulated by three levels of government: local, state, and federal.' is true. This is evidenced by policies and regulatory bodies such as the California Air Resources Board, EPA's national air quality standards, and local city regulations on emissions through permit sales. Regarding the classification of policies:

  1. Market incentive based: A state emissions tax on the quantity of carbon emitted by each firm; a city sells permits to firms that allow them to emit a specified quantity of pollution; the federal government pays fishermen to preserve salmon.
  2. Command-and-control: The federal government requires domestic auto companies to improve car emissions by 2020; The EPA sets national standards for water quality.

Moreover, in the United States, elections are mostly regulated by cities and localities, which demonstrates the involvement of different governmental levels in various regulatory areas.

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