Firm US Steel 1 ton of pollution 2 tons of pollution 3 tons of pollution 140.00 380.00 760.00 Ford 220.00 840.00 1145.00 Apple 1295.00 1505.00 1925.00 Suppose the government gives every firm enough permits so that, without trade, every firm must clean two units of pollution. What will the cost be to every firm, and the cost to clean 6 units of pollution? The market price for a permit is $1400. Net Cost for US Steel = $ Net Cost for Ford = $ Net Cost for Apple = $ Societal cost to clean = $

Firm US Steel 1 ton of pollution 2 tons of pollution 3 tons of pollution 140.00 380.00 760.00 Ford 220.00 840.00 1145.00 Apple 1295.00 1505.00 1925.00 Suppose the government gives every firm enough permits so that, without trade, every firm must clean two units of pollution. What will the cost be to every firm, and the cost to clean 6 units of pollution? The market price for a permit is $1400. Net Cost for US Steel = $ Net Cost for Ford = $ Net Cost for Apple = $ Societal cost to clean = $

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter12: Environmental Protection And Negative Externalities

Section: Chapter Questions

Problem 44P: In the Land of Purity, there is only one form of pollution, called gunk. Table 12.14 shows possible...

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How can high-income countries benefit from covering much of the cost of reducing pollution created by low-income countries?
A country called Sherwood is very heavily covered with a forest of 50,000 trees. There are proposals to clear some of Sherwoods forest and grow com, but obtaining this additional economic output will have an environmental cost from reducing the number of trees. Table 12.11 shows possible combinations of economic output and environmental protection. Sketch a graph of a production possibility frontier with environmental quality on the horizontal axis, measured by the number of trees, and the quantity of economic output, measured in corn, on the vertical axis. Which choices display productive efficiency? How can you tell? Which choices show allocative efficiency? How can you tell? In the choice between T and R, decide which one is better. Why? In the choice between T and S, can you say which one is better, and why? If you had to guess, which choice would you think is more likely to represent a command-and-control environmental policy and which choice is more likely to represent a market-oriented environmental policy, choice Q or S? Why?
Consider the case of global environmental problems that spill across international borders as a prisoners dilemma of the sort studied in Monopolistic Competition and Oligopoly. Say that there are two countries, A and B. Each country can cheese whether to protect the environment, at a cost of 10, or not to protect it, at a cost of zero. If one country decides to protect the environment, there is a benefit of 16, but the benefit is divided equally between the two countries. If both countries decide to protect the environment, there is a benefit of 32, which is divided equally between the two centuries. In Table 12.10, fill in the costs, benefits, and total payoffs to the countries of the following decisions. Explain why, without some international agreement, they are likely to end up with neither country acting to protect the environment.
As the extent of environmental protection expands, would you expect the marginal benefits of environmental protection to rise or fall? Why or why not?
Is zero pollution possible under a marketable permits system? Why or why not?
The table below shows the marginal cost for three firms to clean up units of pollution. Marginal Cost ($) to clean... Firm 1 ton of pollution 2 tons of pollution 3 tons of pollution US Steel 155 580 860 Ford 220 865 1280 Apple 1200 1600 1915 Suppose the government gives every firm enough permits so that, without trade, every firm must clean two units of pollution. What. will the cost be to every firm, and the cost to clean 6 units of pollution? The market price for a permit is $1400. Net Cost for US Steel = $ Net Cost for Ford = $ Net Cost for Apple = $ Societal cost to clean = $ F12
Use this prompt to answer the following questions about tradeable permits. Two firms each currently dump 20 tons of pollution a piece into a local river. The government wants to reduce the amount of pollution in the river so they issue 5 permits to each firm. The cost for firm A to reduce their pollution by 1 ton is $1000 and the cost for firm B to reduce their pollution by 1 ton is $800. When answering the questions below simply enter the number for your answer do not write a full sentence. Question 1 If trade is NOT allowed what will be the cost of reducing pollution will be for firm A, for firm B, and in total. 3 pts
17. Two firms, A and B, each currently dump 50 tonnes of chemicals into the local river. From now on both firms will require a pollution permit for each tonne of pollution dumped. The government gives each firm 20 tonnes' worth of pollution permits, which it can either use or sell to the other firm. It costs Firm A $100 for each tonne of pollution that it eliminates before it reaches the river, and it costs Firm B $50 for each tonne of pollution that it eliminates before it reaches the river. After the two firms buy or sell pollution permits from each other, what would we expect that Firm A and Firm B will dump? a Firm A will dump 10 fewer tonnes of pollution into the river, and Firm B will dump 50 fewer tonnes of pollution into the tiver. b. Firm A will dump 50 fewer tonnes of pollution into the iver, and Firm B will dump 10 fewer tonnes of pollution into the river. c. Firm A will dump 50 fewer tonnes of pollution into the river, and Firm B will dump 10 more tonnes of pollution into…
There are three industrial firms in a town Firm Initial Pollution Level Cost of Reducing Pollution by 1 Unit A 30 units $20 40 units 20 units B с $30 $10 The government wants to reduce pollution to 60 units, so it gives each firm 20 tradable pollution permits. 1. Who sells permits and how many do they sell? Who buys permits and how many do they buy? Briefly explain why the sellers and buyers are each willing to do so. What is the total cost of pollution reduction in this situation? 2. How much higher would the costs of pollution reduction be if the permits could not be traded?
There are three industrial firms in Happy Valley.FirmInitial PollutionLevelCost of ReducingPollution by 1 UnitA 30 units $20B 40 units $30C 20 units $10The government wants to reduce pollution to 60 units,so it gives each firm 20 tradable pollution permits.a. Who sells permits and how many do they sell?Who buys permits and how many do they buy?Briefly explain why the sellers and buyers are eachwilling to do so. What is the total cost of pollutionreduction in this situation?b. How much higher would the costs of pollutionreduction be if the permits could not be traded?
EOC 11.04 Two businesses, X and Y, each dump 20 tonnes of pollution into a creek. In an effort to reduce pollution, the government will now require businesses to have a pollution permit to dump pollutants in the creek. Each business receives 10 pollution permits and they can use it to pollute or sell it to the other business (but lose the ability to pollute). To reduce pollution it costs business X $100 per tonne of pollutant eliminated and it costs business Y $50 per tonne of pollutant eliminated. Once the two businesses have traded these permits with each other, what is the likely outcome? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a business X emits 10 tonnes of pollutants and business Y emits 10 tonnes of pollutants. b business X no longer pollutes, and business Y will not lower the amount it pollutes. business X raises its pollution, and business Y will lower how much it pollutes. business Y no longer pollutes, and…
wo firms, A and B, each currently dump 50 tonnes of chemicals into the local river. The government has decided to reduce the pollution and from now on will require a pollution permit for each tonne of pollution dumped into the river. It costs Firm A $100 for each tonne of pollution that it eliminates before it reaches the river, and it costs Firm B $50 for each tonne of pollution that it eliminates before it reaches the river. The government gives each firm 20 pollution permits. Government officials are not sure whether to allow the firms to buy or sell the pollution permits to each other. What is the total cost of reducing pollution if the firms are NOT allowed to buy and sell pollution permits from each other, and what is the total cost of reducing pollution if the firms ARE allowed to buy and sell permits from each other? A. $4500; $2500 B. $3000; $1500 C. $4500; $3500 D. $4500; $4000