Economics (AS & A Level) · Oct / Nov 2025 · Paper 31 · Question 13
9708Government policies to achieve efficient resource allocation and correct market failure
What is an advantage of pollution permits, when compared with an alternative policy of taxes levied on the quantity of pollutants emitted by firms?
- Afirms cannot sell any surplus permits
- Bno monitoring of firms’ emissions is required
- Cpollution levels can be reduced to zero
- Dthe reduction in the level of pollution is more predictable
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Correct answer: D. the reduction in the level of pollution is more predictable
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