What is a carbon cap and trade policy? Group of answer choices It sets a maximum allowable level of emissions and creates a market for carbon allowances so companies can sell unused carbon credits or buy ones from other companies that are under the limits. It sets a cost associated with the amount of greenhouse gas ($ per ton of emissions, for example) emitted so that big emitters will pay more. It sets a maximum allowable level of pollution and penalizes companies that exceed their emission allowance. It sets up a market where companies can pay for trees to be planted to offset greenhouse emissions