When using the traditional command-and-control approach to environmental regulation, the government attempts to:
a. make allowances for differences across industries and between firms.
b. set standards that are applicable to all situations and does not recognize unique circumstances.
c. set a minimum requirement and then allows the firm to determine the most efficient method for achieving this requirement.
d. determine the most efficient method for different industries.

Which of the following is the best example of a command-and-control regulation?
a. Effluent taxes on pollutants.
b. Offset programs.
c. Requiring automobiles to have catalytic converters.
d. Emissions trading.

The optimal level of pollution is:
a.zero.
b.the level at which the total social cost of air quality equals the total social benefit.
c.the level at which the marginal social cost of air quality equals the marginal social benefit.
d.the level at which the average social cost of air quality equals the average social benefit.

Suppose a firm wants to build a new factory that would add pollution to an already polluted area. Under an offset program, the firm must:
a.purchase pollution permits from the government.
b.pay a tax which depends on the amount of pollution created.
c.reduce or eliminate an old pollution source in the area.
d.install scrubbers and other government-mandated equipment.

Negative externalities:
a.are found only in large cities.
b.occur whenever individual health is harmed in the production process.
c.impose most of their costs directly on consumers of polluting processes.
d.impose most of their costs on individuals other than consumers of the polluting product.