The Tax Approach May Be Favorable Over a Direct Controls

Multiple Choice

The tax approach may be favorable over a direct controls approach to pollution cleanup because

A) all firms face identical costs.
B) large firms are the most likely to reduce their pollution and therefore, have the greatest impact.
C) small firms are most likely to reduce their pollution since they are most efficient at it.
D) firms that have the ability to reduce pollution at the lowest cost do so, while others do not.