The federal government to reduce their pollution levels

Assignment Help Business Economics

Reference no: EM131242569

Two firms are ordered by the federal government to reduce their pollution levels. Firm A's marginal cost associated with pollution reduction is MC=150+3Q. Firm B's marginal cost associated with pollution reduction is MC=9Q. The marginal benefit of pollution reduction is MB=270. What is the socially optimal level of each firms pollution reduction? Compare the social of three possible outcomes: (1)require both firms to reduce pollution by the same amount. (2) charge a common tax per unit of pollution. (3) require both firms to reduce pollution by the same amount, but allow pollution permits to be bought and sold.

Reference no: EM131242569

Questions Cloud

What is growth rate of nominal GDP and the inflation rate : In the country of Wiknam, the velocity of money is constant. Real GDP grows by 3 percent per year, the money stock grows by 8 percent per year, and nominal interest rate is 9 percent. What is the growth rate of nominal GDP and the inflation rate?

Compute the variable weight price index for each year : For calculations involving the fixed-weight and variable-weight indexes use 2010 as the base year. Compute the Fixed Weight Price Index for each year. Compute the variable weight price index for each year.

Budget constraint-services proctoring exams : Chris works at student services proctoring exams. This is Chris’ only source of income. Chris is paid $10 per hour. Chris is allowed to choose how many hours per week she works, as long as it is between 0 and 15. Graph, on a well labeled graph, Chris..

What are the effects of an increase in the minimum wage : Which of the following is NOT a function of rental prices? What are the effects of an increase in the minimum wage? who would be most affected? The minimum wage laws seek to.

The federal government to reduce their pollution levels : Two firms are ordered by the federal government to reduce their pollution levels. Firm A's marginal cost associated with pollution reduction is MC=150+3Q. Firm B's marginal cost associated with pollution reduction is MC=9Q. The marginal benefit of po..

What is the present value equivalent : Lucas saved his tin foil for over 80 years, and just sold his collection to "Believe it or not" for $25,000,000. Way to go, Lucas! The "Believe it or not" organization will pay Lucas his money in 25 annual installments of $1,000,000 each, with the fi..

How much should you deposit in an account today : Your parents just dropped $15000 in your lap.You want to spend a little on a nice beach vacation, but know you should save some. How much should you deposit in an account today, one that earns 4% interest per year, if want to have $15,000 in the acco..

Assume that perfectly competitive firms are employing labor : Assume that perfectly competitive firms are employing labor in profit-maximizing amounts. Now suppose that, all else being equal, the market supply of this labor increases. How will the firms respond? How will they know when to stop responding?

Solve for the equalibrium price and quantity : Suppose that the supply for potatoes is Qs=2000+200P and the demand for potatoes is Qd=4000-300P-2I, where P is Price and I is Income. Let I=500. are potatoes a normal good or an inferior good based on the demand function? briefly explain. solve for ..

User Account

All Pages