A city currently emits 16 million gallons (MG) of raw sewage into a lake that is beside the city. The table below shows the total costs (TC) in thousands of dollars of cleaning up the sewage to different levels, together with the total benefits (TB) of doing so. Benefits include environmental, recreational, health, and industrial benefits. Emissions Total Cost Marginal Cost Total Benefit Marginal Benefit 16 MG Current N/A Current N/A 12 MG 50   800   8 MG 150   1300   4 MG 500   1650   0 MG 1200   1950   Complete the table.

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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  1. A city currently emits 16 million gallons (MG) of raw sewage into a lake that is beside the city. The table below shows the total costs (TC) in thousands of dollars of cleaning up the sewage to different levels, together with the total benefits (TB) of doing so. Benefits include environmental, recreational, health, and industrial benefits.

Emissions

Total Cost

Marginal Cost

Total Benefit

Marginal Benefit

16 MG

Current

N/A

Current

N/A

12 MG

50

 

800

 

8 MG

150

 

1300

 

4 MG

500

 

1650

 

0 MG

1200

 

1950

 

  1. Complete the table.
  2. What is the optimal level of sewage for this city? How can you tell?

 

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