Refer to the data provided in Table 16.2 below to answer the following question(s).
Table 16.2 shows the situation facing two firms, both of which are polluting. Assume that each firm emits 5 units of pollution.
Refer to Table 16.2. Suppose the government wants to reduce the total amount of pollution from the current level of 10 to 4. To do this, the government caps each firm's emissions at 2 units and issues 2 permits to each firm. If firms are allowed to trade permits and all possible trades are made, Firm A will reduce its pollution by a total of ________ units.
◦ 2
◦ 3
◦ 4
◦ 5
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