4. Understanding different policy options to correct for negativeexternalities Carbon dioxide emissions have been linked to degradation of air quality. The following table lists some potential regulations targeting the amount of airborne carbon dioxide. For each policy listed, identify whether it is a command-and-control policy (regulation), tradable permit system, corrective subsidy, or corrective tax. Public Policy The government limits total carbon-dioxide emissions by all factories to 240,000 tons per five years. Each individual factory is given the right to emit 220 tons of carbon dioxide, and factories may buy and sell these rights in a marketplace. The government agrees to reimburse all factories that purchase new, emissions-reducing technology in order to provide cleaner air. The government orders every factory to adopt a new technology, which reduces carbon-dioxide emissions into the atmosphere. The government charges factories $270 for every ton of carbon dioxide they emit. Command-and- Control Policy Tradable Permit System Corrective Subsidy Corrective Tax