Figure 10-18. The graph represents a corrective tax to reduce pollution. On the axes, Q denotes the quantity of pollution and P represents the price of pollution.
-Refer to Figure 10-18. What is the appropriate label for the downward-sloping line on the graph?
A)"Demand for clean air"
B)"Demand for pollution rights"
C)"Supply of pollution permits"
D)"Tax paid to government"

Question

Figure 10-18. The graph represents a corrective tax to reduce pollution. On the axes, Q denotes the quantity of pollution and P represents the price of pollution. 
-Refer to Figure 10-18. What is the appropriate label for the downward-sloping line on the graph?
A)"Demand for clean air" 
B)"Demand for pollution rights" 
C)"Supply of pollution permits" 
D)"Tax paid to government"

Quizplus · Accepted Answer

The label for the downward-sloping line on the graph is "Demand for pollution rights". This line represents the market demand for pollution permits, which decrease in quantity as the price of pollution increases due to the corrective tax.