Which of the Following Is the Best Definition of a Cap-And-Trade

question 88

Multiple Choice

Which of the following is the best definition of a cap-and-trade policy for pollution?

• A) The government sets a cap on emissions.Firms are given permits by the government to emit pollutants and have the right to trade the permits with each other.
• B) Emissions of a pollutant are capped by the government at the current level,and the good being produced can still be traded in the market.
• C) Production of the good is capped by the government at the current level,but the good can still be traded in the market.
• D) The number of firms producing a good is capped by the government at the current level,but the good can still be traded in the market.
• E) Consumption of the good being produced is capped by the government at the current level,but the good can still be traded in the market.

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Definitions:

Federal Government

A system of government where sovereignty is constitutionally divided between a central governing authority and subnational entities, such as states or provinces.

Privatization

The process of transferring ownership of a business, enterprise, agency, public service, or public property from the government to private individuals or organizations.

Youth Detention Center

A facility where juveniles are held temporarily in custody while awaiting court judgment or placement in long-term care facilities.

Federal Government

The national government of a federated state, which typically has specific powers delegated to it by a constitution, distinct from regional or local governments.