Table 281 Refer to Table 28

Table 28.1 $\begin{array}{|c|r|r|}\hline\begin{array}{c}\text { Reduction in Emissions } \\\text { (in tons) }\end{array} & \begin{array}{c}\text { MC to Reduce Emissions by } \\\text { SteelPlant }\end{array} & \begin{array}{c}\text { MC to Reduce Emissions by } \\\text { Paper Plant }\end{array} \\\hline 1 & \$ 400 & \$ 200 \\\hline 2 & 500 & 280 \\\hline 3 & 600 & 320 \\\hline\end{array}$
Refer to Table 28.1.Suppose the government allows these two firms to trade pollution permits.The most efficient transaction would result in

A) An increase in emissions by the steel plant and a reduction by the paper plant.
B) A reduction in emissions by the paper plant and no change for the steel plant.
C) An increase in emissions by both plants.
D) A decrease in emissions by both plants.

Correct Answer:

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