There are two firms that produce pollution, firm A produces pollution of a quantity 20 and firm B produces pollution of a quantity 30. The firm A marginal cost of reducing pollution is MCA = 20 + QA and for firm B MCB = 30 + QB. The marginal benefit for the society of reducing pollution is 110 2QT OT . [A] What is the socially optimal level of pollution reduction for firm A and B? If it's equal: why? If it's different, why? Mention the economic intuition. [B] Mention the level of price regulation that the government would want to put in the initial situation to get to the social optimum. [C] Can a quantity regulation plus trade-able permits get the social optimum: detail your answer.