Which example BEST describes tradable emissions permits?
A)a tax system for internalizing emission costs to the market
B)a subsidy system for encouraging production of goods with positive externalities
C)a system of voluntary negotiations between polluters and damaged parties
D)a system of licenses that can be bought and sold and that enable the holder to pollute up to a specified amount during a given period

Question

Quizplus · Accepted Answer

Tradable emissions permits are licenses that can be bought and sold, allowing the holder to pollute up to a specified limit during a certain time period. This system creates a market for pollution control and encourages companies to reduce emissions to stay under the limit or to sell unused permits to others who may exceed their limit.

Which Example BEST Describes Tradable Emissions Permits