Under a cap-and-trade system,a firm that emits more than its share of carbon can buy allowances from a firm that emits less than its share.

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This is the essence of cap-and-trade system where firms that emit less than their allocated allowance can sell their excess allowances to firms that emit more than their share of carbon in order to comply with the overall emissions cap.

Under a Cap-And-Trade System,a Firm That Emits More Than Its