A carbon tax which is designed to reduce pollution is an example of a
A)command-and-control policy.
B)government administrative rule.
C)noneffective incentive.
D)market-based policy.

Question

Quizplus · Accepted Answer

A carbon tax is a market-based policy, which means it is designed to use market incentives to encourage companies to reduce pollution. By putting a price on carbon emissions, businesses will have a financial incentive to reduce emissions since it will become more expensive for them to continue emitting. This approach is seen as more efficient and effective than traditional command-and-control policies, which simply mandate emissions reductions without providing any financial incentive to do so.

A Carbon Tax Which Is Designed to Reduce Pollution Is