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15 Jan 2026, 22:00
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E
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Difficulty:
35%
(medium)
Question Stats:
72% (01:35) correct
28%
(01:56)
wrong
based on 166
sessions
History
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A carbon credit is a permit that allows a company to produce a certain amount of greenhouse gases. The government issues the credits to companies who invest in environmental initiatives. After reaching their limit for greenhouse gas production, larger companies sell their remaining credits to smaller companies for less than the smaller companies would need to invest in environmental initiatives to earn the credits themselves. This practice has resulted in a drop in investment in environmental initiatives.
To discourage the purchase and sale of carbon credits, it would be best if the government restricted
A. how many credits a company can earn per year
B. the industries that can use the credits
C. in which months of the year the additional credits can be used
D. how much time may elapse between the issuing and use of the credits
E. the use of the credits to the companies that earned them and the companies’ subsidiaries
To discourage the purchase and sale of carbon credits, it would be best if the government restricted
A. how many credits a company can earn per year
B. the industries that can use the credits
C. in which months of the year the additional credits can be used
D. how much time may elapse between the issuing and use of the credits
E. the use of the credits to the companies that earned them and the companies’ subsidiaries
15 Jan 2026, 22:15
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Correct answer: E. the use of the credits to the companies that earned them and the companies’ subsidiaries
Why E is right
Why E is right
- The problem is that companies are buying and selling credits, which reduces incentives to invest in environmental initiatives.
- If credits can only be used by the company that earned them (and its subsidiaries), then selling is no longer possible.
- This directly stops trading, forcing companies to invest themselves if they need credits.
ExpertsGlobal5
17 Jan 2026, 01:55
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E: This restriction will result in small companies not being able to but the remaining credits from the larger companies - as the smaller companies will not be able to use their credits as they did not "earn" them by investing in environmental initiatives.
