3. Assume that a mining company that produces ore sells its product for $40 per ton. Also assume that the $40/ton price represents both the private and social benefit per ton. In producing ore, the mining company incurs costs, represented by MPC. Furthermore, the pollution the company generates travels down stream to impose additional "external" costs on society, represented by MEC. Both the private costs to the firm and external costs are as follows. Ore Mined (tons) MPC to firm ($/ton) MEC ($/ton) $7 $5 $11 $16 12345 1 2 3 4 5 $15 $24 $40 $45 $26 $35

3. Assume that a mining company that produces ore sells its product for $40 per ton. Also assume that the $40/ton price represents both the private and social benefit per ton. In producing ore, the mining company incurs costs, represented by MPC. Furthermore, the pollution the company generates travels down stream to impose additional "external" costs on society, represented by MEC. Both the private costs to the firm and external costs are as follows. Ore Mined (tons) MPC to firm ($/ton) MEC ($/ton) $7 $5 $11 $16 12345 1 2 3 4 5 $15 $24 $40 $45 $26 $35

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter14: Environmental Economics

Section: Chapter Questions

Problem 7SQ

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