When new technologies make cleaner production possible,
A) emissions would fall under a system of fees, but would not fall under a system of transferable emissions permits unless the government bought back some of the permits.
B) emissions would fall under a system of permits, but would not fall under a system of fees unless the government raised them.
C) the price of transferable permits would rise.
D) the quantity of transferable permits would rise.
E) the quantity of transferable permits would fall.

Question

Quizplus · Accepted Answer

When cleaner production technologies are introduced, emissions would naturally decrease under a fee system as firms reduce emissions to save costs. However, under a transferable permit system, emissions would not decrease unless the government reduces the number of permits, as firms can still emit up to their permit limit.

When New Technologies Make Cleaner Production Possible