Consider the following statements, which may or may not be true, about the cap and trade system
used in the dairy industry in Canada.
(1) The policy consists of extensive subsidies that are funded by the Canadian government.
(2) The policy results in a reduction of PD, the price consumers pay for milk, compared to no
government regulation.
a) Only (1) is true.
b) Only (2) is true.
c) (1) and (2) are both true
d) (1) and (2) are both false.