how-can-a-government-effectively-internalize-a-negative-externality-in-the-marke

Question

How can a government effectively internalize a negative externality in the market for fossil fuels?

Accepted Answer

By imposing a carbon tax equivalent to the social cost of carbon emissions.

Answer

By setting a price floor for fossil fuels.

Answer

By allowing unrestricted fossil fuel extraction.

Answer

By subsidizing fossil fuel production.