Understanding different policy options to correct for negative externalities - Carbon dioxide emissions have been linked to increased air pollution

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Understanding different policy options to correct for negative externalities - Carbon dioxide emissions have been linked to increased air pollution. The following table lists some possible public policies aimed at reducing the amount of carbon dioxide in the air.

For each policy listed, identify whether it is a command-and-control policy (regulation), tradable permit system, corrective subsidy, or corrective tax.

Public Policies

1. The government orders every factory to adopt a new technology, which reduces carbon-dioxide emissions into the atmosphere.
2. Trees take carbon dioxide out of the air and convert it to oxygen, so the government funds a tree-planting initiative by offering $400 to any citizens who plants a tree.
3. The government limits total carbon-dioxide emissions by all factories to 120,000 tons per decade. Each individual factory is given the right to emit 110 tons of carbon dioxide, and factories may buy and sell these rights in a marketplace.
4. The government charges factories $400 for every ton of carbon dioxide they emit.