Chapter 6

Question 1

Acid Rain

Answer 1

Rain that is unusually acidic due to contamination by

emissions of sulfur dioxide (SO2) and nitrogen oxide (NOx).

Question 2

1970 Clean Air Act

Answer 2

Landmark federal legislation that first regulated acid rain–causing emissions by setting maximum standards for atmospheric concentrations of various substances, including SO2.

Question 3

SO2 allowance system

Answer 3

The feature of the 1990 amendments to the Clean Air Act that granted plants permits to emit SO2 in limited quantities and allowed them to trade those permits.

Question 4

greenhouse effect

Answer 4

The process by which gases in the earth’s atmosphere reflect heat from the sun back to the earth.

Question 5

international emissions trading

Answer 5

Under the Kyoto treaty, the industrialized signatories are allowed to trade emissions rights among themselves, as long as the total emissions goals are met.

Question 6

actuarial adjustments

Answer 6

Changes to insurance premiums that insurance companies make in order to compensate for expected expense differences.

Question 7

self-control problem

Answer 7

An inability to carry out optimal strategies for consumption.

Question 8

commitment devices

Answer 8

Devices that help individuals who are aware of their self-control problems fight their bad tendencies.

Question 9

Internality

Answer 9

The damage one does to oneself through adverse health (or other) behavior.