The table below shows the marginal cost for three firms to clean up units of pollution. Marginal Cost ($) to clean... 2 tons of pollution Firm 1 ton 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 = $
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- In the Land of Purity, there is only one form of pollution, called gunk. Table 12.14 shows possible combinations of economic output and reduction of gunk, depending on what kinds of environmental regulations you choose. Sketch a graph of a production possibility frontier with environmental quality on the horizontal axis, measured by the percentage reduction of gunk, and with the quantity of economic output 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 K and L, can you say which one is better and why? In the choice between K. and N, can you say which one is better, and why? If you had to guess, which choice would you think is move likely to represent a command-and-control environmental policy and which choice is more likely to represent a market-oriented environmental policy, choice L or M? Why?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 Kitona. The Government wants to reduce pollution to 120 units, so it gives each firm 40 tradable pollution permits. Firm Initial Pollution Level Cost reducing pollution by 1 unit A 70 Units $20 B 80 Units $25 C 50 Units $10 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?
- There are three industrial firms in Kitona. The Government wants to reduce pollution to 120 units, so it gives each firm 40 tradable pollution permits. Firm Initial Pollution Level Cost reducing pollution by 1 unit A 70 Units $20 B 80 Units $25 C 50 Units $10 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? How much higher would the cost of pollution reduction be if the permits could not be traded?There are three identical firms in Happy Valley. Firms Initial Pollution Level Cost of Reducing Pollution by 1 unit A 30 units $20 B 40 units $30 C 20 units $10 The government wants to reduce total pollution to 60 units, so it gives each firm 20 tradable permits. Who sells permits and how many do they sell? Who buys permits and how many do they buy? Briefly explain why the sellers and buyers are each willing to do so? What is the total cost of pollution reduction in this situation? How much larger would the cost of pollution reduction be if the permits could not be traded?The table below shows the marginal cost for three firms to clean up units of pollution. Marginal Cost ($) to clean... 2 tons of pollution 425.00 745.00 1515.00 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 $1410. Net Cost for US Steel = $ Net Cost for Ford = $ Firm 1 ton of pollution 145.00 US Steel Ford 225.00 Apple 1300.00 Net Cost for Apple = $ Societal cost to clean = $ → 3 tons of pollution 870.00 1280.00 1975.00 →
- The following table shows the marginal costs for each of four firms (A, B, C, and D) to eliminate units of pollution from their production processes. For example, for Firm A to eliminate one unit of pollution, it would cost $54, and for Firm A to eliminate a second unit of pollution it would cost an additional $67. Firm Unit to be eliminated A B C D First unit 54 57 54 62 Second unit 67 68 66 73 Third unit 82 86 82 91 Fourth unit 107 108 107 111 Refer to Table 5. If the government charged a fee of $84 per unit of pollution, how many units of pollution would the firms eliminate altogether?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?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; $4000
- The table below shows the marginal cost for three firms to clean up units of pollution. Marginal Cost ($) to clean... 2 tons of pollution 315.00 880.00 1525.00 Cost for US Steel = $ Cost for Ford = $ Suppose the government enacts a pollution charge of $1055.00 that firms must pay for every ton of pollution they do not clean in the first 3 tons. How much will each firm pay to clean their pollution? Cost for Apple = $ Tax Revenue = Firm US Steel Ford Apple Societal cost to clean 1 ton of pollution 115.00 230.00 1225.00 → ▶ - ▲ 3 tons of pollution 740.00 1225.00 1960.00 SI4. a. If improved technology causes firms' abatement costs to fall, how, if at all, does this affect the amount of pollution that firms will emit when there is a tax? Explain briefly with a diagram.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