If the foreign use of Australian-mined coal is harming Australia, according to the specificity rule, the optimal policy for the Australian government to use is to _____.
A)tax coal imports
B)tax coal exports
C)tax foreign coal producers
D)subsidize coal exports

Question

Quizplus · Accepted Answer

Taxing coal exports is not an optimal policy because it would harm Australian coal producers and exporters. Taxing foreign coal producers is not within Australia's jurisdiction and may lead to diplomatic issues. Subsidizing coal exports goes against the idea of reducing fossil fuel usage globally. Therefore, the optimal policy would be to tax coal imports, which can discourage foreign countries from using Australian coal and incentivize local industries to use renewable energy sources.

If the Foreign Use of Australian-Mined Coal Is Harming Australia