One of the Ways That Initial Pollution Rights Can Be

question 2

Multiple Choice

One of the ways that initial pollution rights can be allocated in a cap and trade program is by equal distribution among all existing sources of a particular effluent.Which of the following is a reason that equal distribution of initial pollution rights among polluters is flawed?

• A)existing firms within an industry vary in size
• B)firms in different industries may vary in value of output
• C)this method does not reward those who have invested in emissions reductions already
• D)all of the above

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