If a firm has a surplus of tradeable permits for a given pollutant, it no longer has an incentive to reduce pollution.

Name: If a firm has a surplus of tradeable permits for a given pollutant, it no longer has an incentive to reduce pollution.
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Question

Quizplus · Accepted Answer

Having a surplus of tradeable permits gives a firm the opportunity to sell these permits to other firms that are exceeding their pollution limits, providing a financial incentive to continue reducing pollution levels.

If a Firm Has a Surplus of Tradeable Permits for a Given