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Advantage-disadvantage of distributing marketable pesticide

Problem: Suppose that the governmental wished to decrease the use of a pesticide that is leaking into water supplies in a watershed by 60% from current use levels.

Discuss the advantages and/or disadvantages of distributing marketable pesticide permits to each farm operating in the watershed equal to 40% of its current level of use of that pesticide, versus simply ordering each farm to reduce pesticide use to 40% of current levels under threat of heavy fines for non-compliance.

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