Problem 3: Tradable Permits There are three major ferry lines operating on the East River, each generating 100 units of pollution per year. The ferry lines face the costs of reducing pollution that...

Answer question on image attached as well as part of questions typed below:

b. The system of tradable permits results in       (lower,same, higher)   pollution as compared to the quota.

c. It leads to a            (  higher,lower,same  )   total cost of pollution reduction and thus is efficient, inefficient,indeterminate   than the quota alone.

Extracted text: Problem 3: Tradable Permits There are three major ferry lines operating on the East River, each generating 100 units of pollution per year. The ferry lines face the costs of reducing pollution that are shown in the table below. Cost of reducing pollution by 1 unit $1,500 $2,500 $1,800 Ferry line A В The government has decided it wants to reduce pollution levels by 50 percent and requires each ferry line to cut its pollution in half.


Extracted text: What is the total cost of pollution reduction under the tradable permits system? Number of Permits Total cost of pollution reduction (not including Ferry Line (after trade) cost of permits) A В C The total cost of pollution reduction is $