Q. With reference to the ‘Carbon Market’ consider the following statements:
1.Carbon markets are trading systems in which carbon credits are sold and bought. 
2.Compliance market is a type of carbon market which refer to the issuance, buying and selling of carbon credits on a voluntary basis.
3.Carbon markets help mobilize resources and reduce costs to give countries and companies the option to smooth the low-carbon transition.
Which of the statements given above is/are correct?

[A] 1 only

[B] 1 and 3 only

[C] 3 only

[D] 1 and 2 only

Answer: B
Notes:

Explanation –

Statement 1 and 3 are correct. Carbon markets are trading systems in which carbon credits are sold and bought. Carbon markets help mobilize resources and reduce costs to give countries and companies the option to smooth the low-carbon transition.

Statement 2 is incorrect. Compliance markets are created as a result of any national, regional and/or international policy or regulatory requirement whereas Voluntary carbon markets refer to the issuance, buying and selling of carbon credits, on a voluntary basis.

Source: The Hindu