Which statement illustrates an environmental policy based on cap and trade?

Question

Quizplus · Accepted Answer

Cap and trade is a policy where a limit, or cap, is set on the total amount of pollutants that can be emitted by companies within a certain industry. Companies are then given permits for a particular level of emissions, with the total amount of permits equaling the cap. If a company emits less than their allotted amount, they can sell their extra permits to companies who need them. This creates a market for emissions permits, where companies can buy and sell their right to emit a certain amount of pollutants.

Which Statement Illustrates an Environmental Policy Based on Cap and Trade