Under Cap and Trade Systems

question 22

Multiple Choice

Under cap and trade systems

• A)an upper limit is set that sets the marginal social costs equal to the marginal benefits of emissions.
• B)an upper limit that sets marginal private costs equal to the marginal private benefits of emissions.
• C)an upper limit that sets marginal social costs equal to the marginal private benefits of production.
• D)an upper limit that sets marginal private costs equal to the marginal social benefits of production.

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Definitions:

Production

Production is the process of combining various material inputs and immaterial inputs (plans, know-how) in order to make something for consumption (output).

Consumption

The act of using up a resource or goods, often related to economic spending or food intake.

Physical And Mental Talents

Innate or acquired abilities in bodily and cognitive functions that individuals possess.

Innovation

The process of translating an idea or invention into a good or service that creates value or for which customers will pay, often leading to novel solutions or improvements.