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A polluting firm's marginal benefit of releasing pollution is MB g = 100-2⋅g, where g is tons of air pollution released into the atmosphere and MBg is its marginal benefit from releasing pollution, in dollars per ton. The marginal external costs of its pollution are given by MEC g=100 +g, where MECs is the external costs to society, also in dollars per ton.
(a) If the firm chooses its pollution level ignoring the marginal external costs, how much pollution will there be?
(b) What is the socially optimal level of pollution?
(c) If you were to design a Pigouvian (unit) tax per unit of pollution emitted by the firm, in order to get it to reduce its pollution emissions, what would the magnitude of this tax be?
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Suppose the number of employed people in an economy is 121,166,640. The unemployment rate in this economy is 10.4 percent, or .104, and the labor force participation rate is 72.5 percent, or .725.
A monopolist faces the demand curve Q = 60-P/2. The cost function is C=Q2. Find the output that maximises this monopolist’s profits. What are the prices at profits and that output? Find the elasticity of demand at the profit maximising output.
is stability in the general level of prices through time important? why or why not? should price stability be the goal
Are your proposals worth the trade-off? Justify your proposals and respond to the proposals from your classmates.
You are a Custom Home Builder and was hit hard by the economic downfall of 2008 in the housing market. You have a 100-acre subdivision with $19,000 a month payments on a land and development loan of$1.8 million.
a. suppose your local congress representative suggests that the federal government should not intervene in the
Consider a simple economy with two individuals, John and Marsha. The economy is endowed with 30 kilograms of cheese and 30 loaves of bread each month. John and Marsha's preferences for bread and cheese are given by their marginal rates of su..
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1.If you take $100 out of your piggy bank and deposit it in your checking account, how did M1 change? Did M2 change? If the deposit will be loaned under 20 per cent reserve ratio, what is the change in M1 and M2 as a result of $100 into the banking s..
The manager of a corporate division faces the possibility of an audit every year. She preferes to spend time preparing if she will be audited; otherwise, she would prefer to invest her time elsewhere.
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