The EPA determined the presence of a public health and ecological damage externality cost in dollars of MEC=0.020 associated with Qunits of nitrogen axides output of a chemical process per month.There was no evidence of external benefit. The marginal social benefit was estimated as MSB=50-0.4Q and the marginal social cost as MSC-2+ 0.40 What is the socially conscious solution?
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- A county govermment has constructed a small dam across a local river in order to control flooding and regulate river flow downstream. However, although the dam has significanty reduced the cost of flooding that used be incurred by the community from what used to be frequent floods, the dam has also eaten-up some of the farmland upstream of the river, thus causing loss of revenue from farming and other related businesses. In performing a benefit-cost analysis of the dam project, which of the folowing is the most traditional form of calculating the B-C ratio for this project? OA PW(Reduced flood conts) - PW(Loss of revenue from farming and related businesses) Initial project costs + PW(Annual O &M Costs) B-C PW(LOss of revenue from farming and related businesses) - PWIReduced flood conts) Initial project costs PW(Annual O & M Costs) OB. B-Ce PW(Reduced flood costs) Initial project costs + PW(Annual O & M Costs) PW(Loss of revenue from farming and related businesses) Oc. B-C- D. B-C=…Computer models of global climate changecaused by increasing carbon dioxide in the atmosphere predictnot only higher overall temperatures, but also more intense andfrequent heat waves. During the devastating European heatwave in the summer of 2003, between 35,000 and 52,000“excess deaths” occurred. Before taking specific actions toreduce carbon dioxide emissions, economists and politicians tryto estimate the costs. Should excess deaths be included as acost of inaction? If so, what value should we place on a life?A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus isnonrival andnonexcludable . Thus, the visual appearance would be classified as a public good. Suppose the college administrators estimate that the beautification initiative will cost $61,110. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 2,240 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $20. The benefit of the beautification initiative, as suggested by the survey, is . Because the estimated benefit is than the cost, the college administrators undertake the beautification initiative. The calculation of the benefit of…
- Why is the presentaion of corparate results increasingly accompanied by the presentation of a socially responsible bussines report. Provide 3 reasonsDefine (a) externalities and (b) sunk costs, andthen give examples of each that might be involvedin a proposal by an energy company to build anew coal-fired electric power generating unit. Howwould these factors be worked into the analysis?Suppose the local authorities wanted to achieve a more drastic reduction in total pollu-tion of 75 tons in the scenario described above. They want to do so via the introductionof a tradable pollution permits system whereby, each permit would allow a power plantto emit one ton of SO2 annually at no cost, but a power plant’s emissions may not exceedit’s permits. The authorities must will distribute 75 permits (to achieve the 150 - 75 =75 ton reduction). Recall that prior to the policy, each plant is emitting 75 tons. '(a) If the regulator issues 35 permits to firm 1 and 40 permits to firm 2, without trading,how much would each firm have to spend to comply with the regulation? Recallthat each firm must abate the pollution for which they do not hold permits. i.e.q1 = 75 −p1 where p1 is the number of permits firm 1 has. (b) At this initial allocation, what is the marginal willingness to pay a permit for firm1? What is the marginal willingness to accept to sell a permit for firm 2?…
- DNPS9.2(a) The market for dry cleaning is reflected by the demand and supply curves (Q is in thousands): Pa = 5-Q Ps= 2 + 2Q Producing dry cleaning creates ground water pollution with a constant marginal external cost of 1.2. (Hint: Think about this graphically and algebraically like a per-unit tax.) (a) Sketch a Graph that shows the Dsoc, Spriv, Ssoc, Qopt (Societal Perspective) & Deadweight Loss (DWL) in an Unregulated Market?A firm has a marginal emissions benefit of 100-0.5*E in each of 2 years, where E measures emissions in tons. The marginal cost of emissions to society is 75/ton. The discount rate is 10% and the marginal cost of emissions also grows at 10% per year. The government decides to give the firm permits to emit 50 tons of emissions per year, but allows the firm to "bank" or "borrow" permits across the two years so that this effectively acts as a 100 ton cap on emissions over 2 years. How much will the firm emit in each year? If all firms are identical to the one you analyze here, is the government issuing too many or too few emission permits relative to the efficient level? How do you know?when left the treat environment as if it has no value the polluters in region release collective 500 tons of pollutant per year. The damages from this pollutant are MD=10e while aggregate abatement cost is MAC=10+5a. Calculate; A)efficient aggregate levels of abatement and emissions B)use calculations to show that a one ton increase or decrease in emissions would not be efficient
- b) Discuss and explain the concept of positive return toscale showing it relationship with the quantity ofproduction.Helllo can you please help me with this question thank you, There are two polluters in the region, Firm 1 is currently emitting 100 units of pollution and Firm 2 is currently emitting 120 units of pollution for a total of 220 units of pollution in the region. The government wants to reduce total pollution by 80 units. For simplicity, ignore enforcement costs. The total and marginal abatement costs of each polluter are as follows: TAC1 = A1+1.5A12 TAC2 = 3A2 + A22 MAC1 = 1 + 3A1 MAC2 = 3+2A2 Suppose each firm is issued the same (equal) number of pollution permits designed in total to achieve the 80-unit reduction. What is the equilibrium quantity of abatement by firm 2? Question 10 options: 32.4 40 120 47.6PRICE (Dollars per ton) 80 72 64 56 48 40 32 24 16 B Demand 0 25 50 75 100 125 150 175 200 225 250 QUANTITY (Millions of tons) Graph Input Tool Daily Demand for Pollution Rights Price 8 (Dollars per ton) Quantity Demanded (Millions of tons) 225 Suppose the government has determined that the socially optimal quantity of sulfur dioxide emissions is 125 million tons per day. One way governments can charge firms for pollution rights is by imposing a per-unit tax on emissions. A tax (or price in this case) of $ of sulfur dioxide emitted will achieve the desired level of pollution. per ton Now suppose the U.S. government does not know the demand curve for pollution and, therefore, cannot determine the optimal tax to achieve the desired level of pollution. Instead, it auctions off pollution permits. Each permit entitles its owner to emit one ton of sulfur dioxide per day. To achieve the socially optimal quantity of pollution, the government auctions off 125 million pollution permits. Given…