Which of the following is true?
A) All types of environmental problems can be solved simply by the enforcement of individual property rights.
B) Environmental regulation cannot improve environmental quality.
C) Regulation nearly always leads to economically efficient outcomes.
D) Government regulation is subject to the same problems caused by lack of information and lack of incentives for economic efficiency that plagued centrally planned economies.

Question

Quizplus · Accepted Answer

Government regulation, like centrally planned economies, may suffer from the problems of lack of information and incentives for economic efficiency. This can result in unintended consequences and inefficiencies. While regulation can be helpful in improving environmental quality, there is a risk of overregulation leading to negative economic impacts. Therefore, a balance must be struck between regulatory action and the need for market-based solutions such as property rights and incentives.

Which of the Following Is True