Correcting for negative externalities $-$ Regulation versus tradable permits

Suppose a municipality votes to reduce the combined pollution introduced by three local companies. Presently, each firm creates $4$ units of pollution in the area, for a total of $12$ pollution units. The government can reduce total pollution in the area to $6$ units by choosing between the following two methods:

Methods to Reduce Pollution

The govemment imposes pollution standards using regulation.

The govermment issues tradable pollution permits.

The costs faced by each firm are different, so it is more difficult for some firms to reduce pollution than others. The following table shows the cost faced by each firm to eliminate each unit of pollution. Assume that the cost of eliminating all $4$ units of pollution $($that is$,$ reducing pollution to zero$)$ is prohibitively expensive for all three firms.

$\backslash$table$[[,,$Cost of Eliminating the...,$],[$Firm$,\backslash$table$[[$First Unit of Pollution$],[($Dollars$)]],$Second Unit of Pollution $($Dollars$),\backslash$table$[[$Third Unit of P$],[($Dollars$]]],[$Firm A$,,,220$