Federal government to reduce their pollution levels

Assignment Help Business Economics
Reference no: EM131424710

Two firms are ordered by the federal government to reduce their pollution levels. Firm A's marginal costs associated with pollution reduction are MC = 30 + 6Q. Firm B's marginal costs associated with pollution reduction are MC = 24 + 12Q. The marginal benefit of pollution reduction is MB = 400 - 4Q. Assume the marginal benefit pollution reduction applies to the overall level (for the two firms combined) and not to each firm separately. What is the socially optimal level of each firm's pollution reduction? Compare the social efficiency of three possible outcomes: Require both firms to reduce pollution by the same amount. Charge a common tax per unit of pollution. Require both firms to reduce pollution by the same amount but allow pollution permits to be bought and sold.

Reference no: EM131424710

Questions Cloud

Graph the budget constraint and the indifference curves : Suppose you have a $20 gift card and want to buy Blue and Red yarn. Graph the budget constraint and the indifference curves that can be reached. How many yards of each type of yarn will he purchase at these prices with his gift card?
How much is each monthly payment : Mary Smith took out a loan of $75,000. The loan runs for five years at a minimum interest rate of 33% with payments due each month. How much is each monthly payment?
What is the size of the money and quasi-money stock : Assuming “other liabilities” are zero, what is the size of the money and quasi-money stock?
What lessons-cautions may be learned from that comparision : Keynes theory on impact of falling wages was to a large extent supported by Irving Fisher in his Debt-Deflation Theory of Great Depressions (1933). Which economy method that we use to get out of Great Depression. Compare 2015 to 1937 and explore what..
Federal government to reduce their pollution levels : Two firms are ordered by the federal government to reduce their pollution levels. Firm A's marginal costs associated with pollution reduction are MC = 30 + 6Q. Firm B's marginal costs associated with pollution reduction are MC = 24 + 12Q.
Identify one or more unintended consequence : identify one or more “unintended” consequence: Consider the consequences of increased life spans for social security system
Find a few costs estimates for the terminal rehab : Check whether you can find a few costs estimates for the terminal rehab. List your reference where your got your costs. Commercial Cost Construction per square foot. Utility Savings per square foot.
Stock returns and retirement account : Stock returns and retirement account: Suppose your retirement account has a balance today of $10,000 and you are 20 years old. Consider how the balance in your account evolves as you age under the different assumptions below. ompute the balance in yo..
What toll should be charged to cover the bond payments : Boston’s Central Artery Project, informally known as “The Big Dig” was rebuilt at a cost of roughly $15 billion. Your engineering firm has been hired to calculate what toll should be charged to cover the bond payments. Suppose the highway carries 200..

Reviews

Write a Review

Business Economics Questions & Answers

  Calculate and describe the nash equilibrium

Calculate and describe the Nash equilibrium (quantities, price and profits) in the game in which both firms choose their quantities simultaneously.

  Foreign-currency exchange-open-economy macroeconomic model

In the market for foreign-currency exchange in the open-economy macroeconomic model, which of the following does the amount of net capital outflow represent?

  Consider two firms-assuming entire market will be served

Consider two firms, located at each end of a street of length 1. There are customers uniformly distributed along this street. Customers incur transportation costs TC = 2x2, where x is the distance they need to travel in order to purchase the product...

  What laws or groups in our economy

After September 11, 2001, there was much talk that the United States was going to go into a depression. There was, in fact, a downturn in the economy that was considered by many to be a recession. A depression did not occur. Why is another depression..

  The canadian economy is starting from equilibrium

The Canadian economy is starting from equilibrium. The following shocks then hit the economy in order: interest rates rise, business taxes increase, and there is an expectation among consumers that there will be a severe increase in inflation over th..

  Dow jones transportation average

The Dow Jones Transportation Average (DJTA) is an average of the share prices of 20 transportation companies. According to the “Dow Theory,” demand for goods is reflected in the amount of cargo carried by transportation companies and delivered to con..

  Experience a greater change in operating income

Firm A and Firm B are competitors in the same industry. The two firms have similar operating costs, except Firm A has more fixed operating costs than Firm B. As a result, which firm would experience a greater change in operating income as the result ..

  Preferences over baskets containing gasoline

Suppose that Elsa's preferences over baskets containing gasoline (good x), and food (good y), are described by the utility function U (x; y) = xy + 100y. The marginal utilities for this function are, MUx = y and MUy = x + 100: Use Px to represent the..

  Emphasizing the difference between money and income

Why do economists insist on emphasizing the difference between money and income? Why is this difference important in macroeconomics?

  Opt-in system for organ donations from the deceased

The United States currently has an “opt-in” system for organ donations from the deceased. People must explicitly choose postmortem donation ahead of time (as when they obtain their driver’s license). Many other nations have “opt-out” systems:

  Which of these statements is most likely to be true

Depends on the evidence in this article and what you know about the economy in the United States, decide which of these statements is most likely to be true.

  When derivative contracts on standardized and traded

When derivative contracts on standardized and traded on an exchange:

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd