(Last Word) Since it's not possible for governments to know the costs of pollution abatement as well as the polluters know themselves, then there is a(n)
A) asymmetric information problem.
B) externality problem.
C) moral hazard problem.
D) problem with the law of demand.

Question

Quizplus · Accepted Answer

The situation described involves a lack of equal information between the government and polluters, which is an example of asymmetric information. The other options listed do not accurately describe the problem at hand.

(Last Word) Since It's Not Possible for Governments to Know