Tradable emission permits are a:
A) tax system for internalizing pollution costs to the market.
B) subsidy system for charging consumers for the use of common property resources.
C) system of voluntary negotiations between polluters and damaged parties.
D) system of exchangeable licenses that enable the holder to pollute up to a specified amount during a given period.

Question

Quizplus · Accepted Answer

Tradable emission permits allow companies to purchase and trade permits that allow them to emit a certain amount of pollution. This creates a market for pollution permits and provides an economic incentive for companies to reduce their emissions below their allotted amount in order to sell any unused permits. It is a system of exchangeable licenses that enable the holder to pollute up to a specified amount during a given period.

Tradable Emission Permits Are A