Cap and trade explained

The video discusses the harmful effects of emissions and introduces the cap and trade system as a market-based mechanism to reduce emissions while minimizing economic impact. It explains how emissions permits are allocated and traded, incentivizing pollution reduction. However, a major drawback is that polluters can relocate to countries without such legislation, continuing to pollute freely.

What are the two main impacts of emissions mentioned in the video?

• They can enhance technological advancements and reduce costs.

• They can increase biodiversity and reduce pollution.

• They can be harmful to nearby residents and contribute to global warming.

• They can cause economic growth and improve air quality.

What is the primary goal of the cap and trade system?

• To increase the number of emissions permits available.

• To provide financial incentives for businesses to pollute more.

• To eliminate all forms of pollution immediately.

• To reduce total emissions while minimizing economic impact.

How can businesses benefit from reducing their pollution under the cap and trade system?

• They can increase their allocated quota for free.

• They can receive tax breaks from the government.

• They can sell excess permits on the market.

• They can avoid all environmental regulations.

What is a significant drawback of the cap and trade system?

• It increases the cost of permits over time.

• It allows polluters to move to countries without such legislation.

• It completely stops all forms of pollution.

• It reduces the number of businesses in the market.

Why might polluters choose to relocate to another country under the cap and trade system?

• To benefit from stricter environmental laws.

• To continue polluting without restrictions.

• To access better technology for pollution control.

• To receive more emissions permits for free.