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Question
The government is considering levying a tax on the pollution generated from two electric power plants (Plant A and Plant B). Plant A is located in a city with a high density of population, and Plant B is located in the rural area with a low density of population. The government should
A) levy the same tax per unit of pollution on both plants.
B) levy a higher tax per unit of pollution on Plant A because of its higher economic damage.
C) levy a higher tax per unit of pollution on Plant B because of its lower economic damage.
D) tax only Plant A but not Plant B because Plant B generates less revenue.
Answer
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Related questions
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