Pollution Permit Policies Achieve an ________ Outcome Because ________

Multiple Choice

Pollution permit policies achieve an ________ outcome because ________.

A) inefficient; wealthier firms can afford to purchase more permits.
B) efficient; firms that have the lowest cost of reducing pollution will be able to pay more for each permit.
C) inefficient; the supply of permits is set by the government, and so is perfectly inelastic.
D) efficient; firms that have the highest cost of reducing pollution will have the greatest incentive to purchase permits.