Assume That the Price of a Tradable Emissions Permit for a Ton

Multiple Choice

Assume that the price of a tradable emissions permit for a ton of sulfur dioxide is $150.Which statement is INCORRECT?

A) A firm that buys permits has an incentive to limit pollution to the point at which the marginal benefit of emissions is equal to $150.
B) A firm that has more permits than it plans to use has an incentive to limit pollution to the point at which the marginal benefit of emissions is equal to $150.
C) The opportunity cost of emitting a ton of sulfur dioxide is $75 for all firms.
D) The opportunity cost of emitting a ton of sulfur dioxide is $150 for all firms.