The government has recently introduced a marketable permit program for major polluters where one permit gives permission to pollute one unit. When the program is introduced, Firm A emits 400 units of pollutant and so is granted 400 permits. After one year, firms are issued 25% fewer pollution permits. If Firm A reduces its pollutants from 400 units to 260 units, how many permits does it sell after one year?

The government has recently introduced a marketable permit program for major polluters where one permit gives permission to pollute one unit. When the program is introduced, Firm A emits 400 units of pollutant and so is granted 400 permits. After one year, firms are issued 25% fewer pollution permits. If Firm A reduces its pollutants from 400 units to 260 units, how many permits does it sell after one year?

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter30: Market Failure: Externalities, Public Goods, And Asymmetric Information

Section30.3: Environmental Policy

Problem 3ST

See similar textbooks

Similar questions

The table below shows the demand for pollution permits to emit hydrocarbons in a particular industrial park. Each permit allows the owner to release one tonne of pollutants into the atmosphere. Price per Pollution Permit Quantity of Permits $4,500 100 4,000 200 3,500 300 3,000 400 2,500 500 2,000 600 1,500 700 were charged, how many tonnes of pollutants would be discharged into the atmosphere, assuming a straight-line a. If fee for a pollution perm demand curve? Quantity: tonnes b. Suppose government were to set a fee of $2,500 per pollution permit. How many tonnes of pollutants would now be dumped? What is the total revenue received by government? Quantity: tonnes Total revenue: $ c. Suppose that a new technology allows for a significant reduction in hydrocarbons at a relatively low cost so that the demand for pollution permits in the industrial park drops by 200 tonnes. Assuming that government holds the permit fee at $2,500, how many tonnes of pollutants would now be dumped? What…
Firm A currently dumps 247 tons of chemicals into the local river. Firm B currently dumps 246 tons of chemicals into the local river. The government has decided to reduce the pollution and from now on will require a pollution permit for each ton of pollution dumped into the river. The government gives Firm A 32 pollution permits and gives Firm B 48 pollution permits. The abatement costs of one ton of pollution is $153 for Firm A and $89 for Firm B. What would be the total cost of reducing pollution, if the firms are .allowed to trade permits between each other?
Firm A currently dumps 243 tons of chemicals into the local river. Firm B currently dumps 126 tons of chemicals into the local river. The government has decided to reduce the pollution and from now on will require a pollution permit for each ton of pollution dumped into the river. The government gives Firm A 61 pollution permits and gives Firm B 65 pollution permits. The abatement costs of one ton of pollution is $113 for Firm A and $165 for Firm B. What would be the total cost of reducing pollution, if the government does NOT allow the firm to trade the permits between each other?
Suppose that there are only two polluters in a society. If left uncontrolled, polluter 1 emits 85 units of a pollutant, while polluter 2 emits 15 units. The polluters' marginal abatement costs are MAC1= 0.25al and MAC2=2a2. Policy makers have established that 28 units is the level to which emissions of the pollutant should be reduced. Determne the abatement responsibilities that should be assigned to each polluter in order to minimize total compliance cost. Illustrate with graphs. (thats all info question gave us)
ЕOC 11.04 Consider two car factories, one run by Ford and the other run by Honda, that both create pollution. The government wants to reduce how much these two factories pollute by 40 tons, so only allow factories to pollute if they have a permit. Each factory is given 20 pollution permits. A business can use a permit to emit one ton of pollution or they can sell it to another business (and lose the ability to pollute). To lower pollution it costs Ford $200 per ton of pollutant removed and it costs Honda $100 per ton removed. After Ford and Honda have met to trade their permits with each other, what we expect to happen? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. Honda emits 20 tons of pollutants and Ford emits 20 tons of pollutants. a Honda no longer pollutes and Ford does not lower how much it produces. Honda increases its pollution and Ford lowers its pollution. Ford no longer pollutes and Honda does not lower how much it…
Chapter 10. 6. Achieving lower pollution
Firm A currently dumps 223 tons of chemicals into the local river. Firm B currently dumps 192 tons of chemicals into the local river. The government has decided to reduce the pollution and from now on will require a pollution permit for each ton of pollution dumped into the river. The government gives each firm 10 pollution permits. The abatement costs of one ton of pollution is $173 for Firm A and $76 for Firm B. What would be the total cost of reducing pollution, if the firms are allowed to trade permits between each other?
EOC 11.04 Two businesses, X and Y, each dump 20 tonnes of pollution into a creek. In an effort to reduce pollution, the government will now require businesses to have a pollution permit to dump pollutants in the creek. Each business receives 10 pollution permits and they can use it to pollute or sell it to the other business (but lose the ability to pollute). To reduce pollution it costs business X $100 per tonne of pollutant eliminated and it costs business Y $50 per tonne of pollutant eliminated. Once the two businesses have traded these permits with each other, what is the likely outcome? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a business X emits 10 tonnes of pollutants and business Y emits 10 tonnes of pollutants. b business X no longer pollutes, and business Y will not lower the amount it pollutes. business X raises its pollution, and business Y will lower how much it pollutes. business Y no longer pollutes, and…
There are 2 firms: Firm X and Firm Y. Firm X has the following cost to pollution reduction: MCx = 10 + 2Qx Firm Y has the following cost to pollution reduction: MCy = 4 + 4Qy Both firms currently produce 100 units of pollution, for a combined production of 200 units. The government has decided to reduce total pollution to 56 units. To do this, the government introduces 56 tradable permits, giving 28 to each firm. What is the equilibrium price of each permit?
The following companies all manufacture widgets and dump tons of glop into the air. Current contribution to overall pollution Manufacturer Polluters-r-us Smog brothers inc Costs to clean up 1 ton of glop $70 $100 $30 200 200 200 Really dirty industries The government wants to halve total pollution but does not know how much it will cost each company. Determine the total cost of the cleanup if the government employs a tradable permit scheme in which it gives the same amount of permits to each manufacturer at no cost.
you 5. Two types of consumers (workers and retirees) share a community with a polluting cheese factory. The pollution is nonrival and nonexcludable. The total damage to workers is p² where p is the amount of pollution and the total damage to retirees is 3p². Thus marginal damage to workers is 2p and marginal damage to retirees is 6p. According to an analysis by consulting engineers, the cheese factory saves 20p - p² by polluting p, for a marginal savings of 20-2p. a. TAT Find the aggregate (including both types of consumers) marginal damage for the public bad. b. Graph the marginal savings and aggregate marginal damage curves with pollu- tion on the horizontal axis. C. How much will the cheese factory pollute in the absence of any regulation or bargaining? What is this society's optimal level of pollution? d. Starting from the uncontrolled level of pollution calculated in part (c), find the marginal willingness to pay for pollution abatement, A, for each consumer class. (Abatement is…
two types of consumers( workers an retirees) share a community with a polluting cheese factory. the polution is nonrival and nonexcludable. the total damage to workers is p2 where p is the amount of pollution and the total damage to retirees is 3p2 . thus marginal damage to workers is 2p and marginal damage to retirees is 6p. according to an anlaysis by consulting engineers, the cheese factory saves 20p-p2 by pollluting p, for a marginal savings of 20-2p. a.Find the aggregate(including both types of sonsumers) marginal damage for the public bad. b..graph the marginal savings and aggregate marginal damage curves with pollution on the horizontal axis. c. how much will the cheese factory pollute in the abscence of any regulation or bargaining? what is the societys optimal level of pollution? d. starting from the uncontrolled level of pollution calculated in part(c), find the marginal willingness to pay for pollution abatment, A, for each consumer class. (abatment is the reduction in…