In the Multiple-Polluter Case for a Pollution Permit System, Suppose

In the multiple-polluter case for a pollution permit system, suppose two firms, X and Y, face marginal abatement costs of MAC_X = 1.2A_X and MAC_Y = 0.4A_Y, respectively. To meet water quality standards, the government issues each firm pollution permits such that each firm must abate 20 units of pollution. If permit trading were allowed,

A) firm X would have an incentive to buy a permit as long as the price were less than $24
B) firm Y would be willing to sell a permit as long as the price were less than $8
C) at a permit price of $22, firm X would have an incentive to buy, but firm Y would have no incentive to sell
D) no trading would take place because neither firm has an incentive to trade based on this model