A market for pollution rights can be expected to
A) eliminate all pollution.
B) produce a shortage of pollution.
C) encourage potential polluters to increase emissions.
D) provide potential polluters with a monetary incentive to reduce emissions.

Question

Quizplus · Accepted Answer

A market for pollution rights provides potential polluters with a monetary incentive to reduce emissions. The system allows for companies that have lower emissions to sell their unused pollution permits to those companies that cannot reduce their own polluting emissions. This creates a profit incentive for companies to reduce their pollution levels and ultimately leads to an overall decrease in pollution.

A Market for Pollution Rights Can Be Expected to