2 and firm B

3. (4 points) Suppose there are two firms producing 6 units of pollution each. The government decides that they want to reduce the total pollution to 6 units, so they issue 3 pollution permits to each firm. The cost of abating the pollution for each firm are given in the following table: FIRM A FIRM B Unit of pollution Marginal Cost of Unit of pollution Marginal Cost of cleaning up this unit cleaning up this unit of pollution of pollution $6 $35 $14 $70 $25 $120 $40 $180 $60 $280 $90 ON $390 If the two firms work together to reduce the total cost of cleaning up the pollution, how many permits will be traded and which firm will sell the permits and which firm will buy the permits