« previous next »

Author Question: The above figure shows the marginal benefit from pollution for two firms. If each firm receives a ... (Read 333 times)

ghost!

  • Hero Member
  • *****
  • Posts: 560
on: Jun 18, 2019


The above figure shows the marginal benefit from pollution for two firms. If each firm receives a marketable permit to produce 25 units of pollution, which one of the following is most likely to happen?
◦ Firm B will sell some pollution rights to firm A.
◦ Firm A will produce all 50 units of pollution.
◦ Firm A will sell some pollution rights to firm B.
◦ Both firms will produce 25 units of pollution.
Microeconomics ¦ Perloff ¦ 8th Edition
Buy Test-Bank


dreamfighter72

  • Sr. Member
  • ****
  • Posts: 355
Reply #1 on: Jun 18, 2019
Firm B will sell some pollution rights to firm A.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question

ghost!

  • Hero Member
  • *****
  • Posts: 560
Reply #2 on: Jun 18, 2019
Thank you!


dreamfighter72

  • Sr. Member
  • ****
  • Posts: 355
Reply #3 on: Jun 18, 2019
Always glad to help...


pane00

  • Hero Member
  • *****
  • Posts: 579
Reply #4 on: Jun 18, 2019


The above figure shows the marginal benefit from pollution for two firms. If both firms receive a marketable permit to pollute 25 units of pollution each, how much will each firm pollute and how much will a permit for one unit of pollution be worth?


trog

  • Sr. Member
  • ****
  • Posts: 343
Reply #5 on: Jun 18, 2019
Firm B will sell permits to firm A until the marginal benefits are the same for both firms. Firm A will generate 37 tons of pollution and firm B will generate 13 tons of pollution. The market value of a permit will be $5.


« previous next »
 

Did you know?

Warfarin was developed as a consequence of the study of a strange bleeding disorder that suddenly occurred in cattle on the northern prairies of the United States in the early 1900s.

Did you know?

Anti-aging claims should not ever be believed. There is no supplement, medication, or any other substance that has been proven to slow or stop the aging process.

Did you know?

According to the FDA, adverse drug events harmed or killed approximately 1,200,000 people in the United States in the year 2015.

Did you know?

The National Institutes of Health have supported research into acupuncture. This has shown that acupuncture significantly reduced pain associated with osteoarthritis of the knee, when used as a complement to conventional therapies.

Did you know?

There used to be a metric calendar, as well as metric clocks. The metric calendar, or "French Republican Calendar" divided the year into 12 months, but each month was divided into three 10-day weeks. Each day had 10 decimal hours. Each hour had 100 decimal minutes. Due to lack of popularity, the metric clocks and calendars were ended in 1795, three years after they had been first marketed.

Otitis media. This illustration shows an inflamed tympanic cavity, which is the most common source o Otitis media. This illustration shows an inflamed tympanic cavity, which is the most common source o
Pierolapithecus catalunicus may be an ancestor of great apes and humans. Its postcranial skeleton sh Pierolapithecus catalunicus may be an ancestor of great apes and humans. Its postcranial skeleton sh
Marginal Products of Physical and Human Capital Marginal Products of Physical and Human Capital
This image shows a normal third-trimester fetal brain This image shows a normal third-trimester fetal brain
A comparison of a trait (height) that shows discontinuous and continuous phenotypes in different pla A comparison of a trait (height) that shows discontinuous and continuous phenotypes in different pla
A melting profile shows the increase in UV absorption versus temperature A melting profile shows the increase in UV absorption versus temperature
Video: Types of Transport - Uniport, Antiport and Symport (Glucose and Na+K+ Transporters)

For a complete list of videos, visit our video library