Transcript Which of the following actions is most likely to result in

ENVR 210
CLICKER QUESTIONS
Chapter 10 (Mankiw) – Clicker Question Set #3
Which of the following statements is correct about a
market in which pollution is emitted?
1.
2.
3.
4.
Both corrective taxes and pollution permits
internalize the externality of pollution.
Corrective taxes internalize the externality of
pollution, but pollution permits do not
internalize that externality.
Corrective taxes fail to internalize the
externality of pollution, but pollution permits
do internalize the externality.
Neither corrective taxes nor pollution permits
internalize the externality of pollution.
64%
27%
9%
0%
1.
2.
3.
4.
In many cases the Coase theorem does not work
well because
1.
2.
3.
4.
there are too few parties at the
negotiation table.
the government does not know
about the Coase theorem.
transaction costs are too high.
transaction costs are too low.
50%
20%
20%
10%
1.
2.
3.
4.
Assume that your roommate is very messy. According to
campus policy, you have a right to live in an uncluttered
apartment. Suppose she gets an $80 benefit from
being messy but imposes a $60 cost on you. The Coase
theorem would suggest that an efficient solution would
be for your roommate to
1.
2.
3.
4.
stop her messy habits or else move
out.
pay you at least $60 but less than
$80 to live with the clutter.
continue to be messy and force you
to move out.
demand payment of at least $60
but no more than $80 to clean up
after herself.
58%
33%
8%
0%
1.
2.
3.
4.