1.Under a system of marketable pollution permits, a firm with                   (low/high) abatement costs will buy permits from a firm with                     (low/high) abatement costs. 2. Arrow up...

1.Under a system of marketable pollution permits, a firm with
 (low/high) abatement costs will buy permits from a firm with
(low/high) abatement costs.

2. Arrow up or down: A switch from regular pollution permits to marketable permits
the total cost of abatement.

3. A decrease in the supply of marketable pollution permits will shift the supply curve for permits to the and the
equilibrium price of permits.

4. Arrows up or down: A technological advance that decreases abatement costs will
the demand for marketable pollution permits  and
 the equilibrium price.

5. Dry weather in the Nordic countries will
the demand for CO2 allowances and

the equilibrium price. (Related to Application 4 on page 694.)