Cap-and-trade is a trading system designed to achieve more efficient pollution control. It can be described as:
A) a program that issues tradable permits in order to limit aggregate emissions.
B) a program that regulates the base rate at which pollutants are emitted.
C) a program that sets a standard for emission that no firm can exceed.
D) a program that allows new firms to pay existing firms to reduce their emissions below a standard.

Question

Quizplus · Accepted Answer

Cap-and-trade is a program that issues tradable permits to firms for their emissions, with a total cap on the number of permits available. Firms can buy and sell permits in order to achieve their emission targets, incentivizing more efficient pollution control.

Cap-And-Trade Is a Trading System Designed to Achieve More Efficient