1. The term________ refers to a market exchange that affects a third party who is outside or external to the exchange.

a) private costs

b) social costs

c) market failure

d) spillover

2. Which of the following is used to describe the full spectrum of animal and plant genetic material?

a) ecodiversity

b) envirodiversity

c) biodiversity

d) duodiversity

3. Property rights are the legal rights of ownership on which others are

a) able to enforce use of pollution-control technologies

b) not allowed to infringe without paying compensation

c) allowed to infringe by paying the porperty owner's pollution tax

d) able to specify allowable quantities of pollution

4. The number of people served by advanced wastewater treatment plants doubled between 1968 and the mid-1990s, but because the treatment plants __________, the quantity of waste emitted into the water after treatment ______________.

a) became so much more effective; decreased by about one-third

b) became so much less effective; increased by about one-third

c) remained ineffective;remained the same

d) moderately improved; increased by 10%

5. The main categories of market-oriented approaches to pollution control are

a) redefined property rights; pollution permits;marketable charges.

b) marketable permits; better-defined property rights; pollution charges.

c) pollution permits;diefened property rights; marketable charges.

d) pollution charges; extended property rights; marketable permits.

6. Because of the nature of the comprehensive environmental laws adopted during the late 1960s and early 1970s by the United States government, these laws are typically referred to as _______.

a) command and control regulations

b) negative regulations

c) positive regulations

d) control and command regulations

7. The comprehensive environmental laws adopted during the late 1960s and early 1970s by the United States government

a) allowed pollution credits to be tranded between polluters to avoid bearing social costs.

b) stipulated mandatory use of particular pollution-control technologies

c) stipulated exemptions for industries that lobbied politicians hard to avoid regulation

d) allowed industries to determine pollution levels based on profit margins

8. The arguments presented by economists regarding U.S. environmental command-and-control regulations generally

a) accept the goal of reducing pollution

b) question the regulations as being the best policy tools for meeting reduction goals

c) assert that these laws are clear of the usual fine print, loopholes and exceptions

d) lack flexibility and a and b above

9. To be effective, U.S. command-and-control environmental regulation required

a) social costs of industrial pollution to become unavoidable business costs.

b) firms to take the social costs of pollution into account

c) firms to increase their costs by installing specified anti pollution equipment

d) the EPA to oversee all environmental laws and all of the above

10. The flexibility of marketable permits program developed for the oil refining industry is credited with achieving the reduction in lead pollution for

a) 50%

b) 20%

c) at least 50%

d) at least 20%