Moderate

Which of the following are potential solutions to the problem of air pollution?

Correct answer: D. all of these answers

  • A. Grant right of the clean air to citizens so that firms must purchase the right to pollute
  • B. Auctions off pollution permits.
  • C. Regulate the amount of pollutants that firms can put in the air
  • D. all of these answers

Explanation

Air pollution can be controlled through property rights, tradable pollution permits, or direct limits on emissions. Since each listed policy is a recognised solution, all of these answers is correct.

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Government revenue and expenditure are analysed through taxation, public borrowing, budgets, subsidies, transfers and public debt. The topic explains how fiscal policy affects resource allocation, income distribution, economic stability and growth, while distinguishing direct from indirect taxes, progressive from regressive taxation, and public goods from goods supplied by private markets.

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