Which of the following are characteristics of tradeable pollution permits?
(i) they are a scarce resource
(ii) they can be traded in a market governed by supply and demand
(iii) they eventually lead to an efficient elimination of all pollution
A)(i), (ii) and (iii)
B)(iii) only
C)(i) and (iii) only
D)(i) and (ii) only

Question

Quizplus · Accepted Answer

Tradeable pollution permits are a scarce resource and can be traded in a market governed by supply and demand. However, they do not necessarily lead to an efficient elimination of all pollution, as they only aim to reduce pollution to the level determined by the cap set on the total amount of permits issued. Therefore, option (iii) is not correct.

Which of the Following Are Characteristics of Tradeable Pollution Permits