answer only part D please Private enterprises often oppose environmental regulation because it raises cost of operation,reducing profits. Suppose that Belville, KS has ten dairy farms whose manure runoff pollutes theRiver. The table below gives information about the operation of each farm, identifiedXA270242580446.C76049126506015E270129.F38015182006.13H.2607252506.35102021204wheredaily milk output in gallonsL daily demand for labor (in worker hours)average daily quantity of manure leaching into the river (in gallons)The wholesale price of milk (px) is $1/gallon, and the wage (pL) is $12/hour. Suppose thatfarms cannot adapt their individual production practices: they either remain in business if theyare profitable, or they have to shut down if they are not.a) Suppose that farms can pollute as much as they want. Which farms are profitable? Assumingthat unprofitable firms shut down, calculate Belville's resulting total milk output, totalcompany profits, and total runoff. The wholesale price of milk (px) is $1/gallon, and the wage (pL) is $12/hour. Suppose that farms cannotadapt their individual production practices: they either remain in business if they are profitable, or theyhave to shut down if they are not.a) Suppose that farms can pollute as much as they want. Which farms are profitable? Assuming thatunprofitable firms shut down, calculate Woodstock's resulting total milk output, total companyprofits, and total runoff.b) Suppose the marginal externai Cost of each gallon of runoff (Pz) is $8. What is the net social benefit?On balance, does society benefit from che profitable farms remaining in business?c) Suppose the Connecticut EPA conducts field measurements of manure runoff and fines each farm atthe level of the external cost it produces. Which farms remain in business? What are total milkoutput, total company profits, and total runoff? What about the net social benefit?d) Suppose that instead of a fine, the EPA imposes a uniform performance standard which is expressedas a maximum runoff intensity (z / x). To enforce the standard, farms which pollute above theintensity limit are forced to shut down. At what range of values (max / min) would the standardhave to be set to result in a similar net social benefit as the fine? How is the outcome different fromthe policy in c)?

Given information Farm type is given Output of milk is given Daily demand for labor is given…

Private enterprises often oppose environmental regulation because it raises cost of operation, reducing profits. Suppose that Belville, KS has ten dairy farms whose manure runoff pollutes the River. The table below gives information about the operation of each farm, identified

Private enterprises often oppose environmental regulation because it raises cost of operation, reducing profits. Suppose that Belville, KS has ten dairy farms whose manure runoff pollutes the River. The table below gives information about the operation of each farm, identified

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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