Expensive to reduce its sulfur dioxide emissions

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Firm A finds it very expensive to reduce its sulfur dioxide emissions, while Firm B finds it very cheap to reduce its sulfur dioxide emissions. If a program of tradable pollution permits was enacted, we would most likely see

Both firms decrease their sulfur dioxide emissions by the same amount.

Both firms increase their sulfur dioxide emissions by the same amount.

Firm A reduce its emissions by more than Firm B.

Firm B sell its permit to pollute to firm A.

Reference no: EM131392186

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