environment medium Fill in the Blank

A 'Carbon Tax' is a fiscal policy instrument that charges emitters for each ton of _____ released into the atmosphere.

  1. Methane
  2. Carbon dioxide equivalent
  3. Nitrous oxide
  4. Sulphur dioxide

Answer: Carbon dioxide equivalent

Carbon taxes internalize the social cost of carbon emissions, incentivizing reduction through market mechanisms and generating revenue for green investments.

Topic Environmental Economics
Exam Relevance UPSC, SSC