Issuing marketable permits to firms that produce a product with ...

[go.lag]

Issuing marketable permits to firms that produce a product with external costs will give the firms the incentive to
 
  A) declare bankruptcy.
  B) buy and sell the permits amongst themselves.
  C) escape the problem completely.
  D) quit producing the output.
  E) increase the external cost because they no longer need to deal with the externality.

Question 2

Consider the demand curves for soft drinks shown in the figure above. Suppose the economy is at point a. Which of the following could result in a movement to point c?
 
  A) a decrease in income
  B) an increase in the relative price of a soft drink
  C) a decrease in the relative price of a soft drink
  D) a decrease in the price of bottled water

[Liamb2179]

Answer to Question 1

B

Answer to Question 2

C

[go.lag]

Thanks for the timely response, appreciate it

[brbarasa]

Excellent