Economists Often Argue That a System of Tradable Pollution Permits

Multiple Choice

Economists often argue that a system of tradable pollution permits is cost-effective because

A) firms facing a high marginal cost of abatement will not abate at all.
B) firms facing a low marginal cost of abatement will not abate at all.
C) firms facing a marginal cost of abatement lower than the permit price will not abate at all.
D) firms with a marginal cost of abatement lower than the permit price will buy permits and abate less.
E) firms will choose their abatement so that their marginal cost of abatement equals the price of a permit,which is the same for all firms.