The Figure Given Below Shows the Demand and Supply Curves

The figure given below shows the demand and supply curves of automobiles.Figure 13.3
In the figure,
D: Demand curve of automobiles
S: Supply of automobiles prior to the tax
S+t: Supply of automobiles after the tax

-When the government tries to control pollution through cap and trade, it _____.

A) issues permits that enables the owners of the permit to pollute
B) allows polluting firms to produce public goods that reduce pollution
C) levies tax on the polluting firm
D) gives subsidies to the firms who adopt clean production technologies
E) takes legal actions against the firms who pollute beyond the specified level

Correct Answer:

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