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Environmental Policy and Employment
Consider two cities, each of which initially experiences 100 tons of pollution per day (50 tons from each polluting firm). City T imposes a pollution tax, resulting in an overall pollution reduction of 20 percent and a decrease in equilibrium employment. City U implements a uniform-reduction policy under which each firm cuts its pollution by 20 percent. Which city will experience a larger reduction in equilibrium employment? Illustrate.
This document contains various important questions and their appropriate answers in the subject field of Economics.
Economics is the study of the principles governing the allocation of scarce means among competing ends when the objective of the allocation is to maximize the attainment of the ends.
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