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Government policies with respect to the recycling

Can you explain how different government policies with respect to the recycling of aluminum and paper might account for these different market outcomes?

E

Expert

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Various government policies could cause these different market outcomes.  For example, requiring the use of recycled aluminum in can production could raise its demand; requiring refundable deposits on cans at the time of purchase could give them a value not given to newspapers; giving tax breaks for the use of recycled aluminum and not for recycled newspapers would also encourage demand for aluminum and not for newspapers.

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