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Provide a brief explanation for regulation of mobile-source pollution is neither focused exclusively onproducers or exclusively on consumers.
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- Economists sometimes shock noneconomists by stating that they do not favor the complete elimination of pollution. Explain the rationale for this position.Explain the connection between the following two concepts: Producer surplus and Benefits of a regulation on pollution.I notice that the last section which I'm including isn't explained. ------ Regulation Versus Tradable Permits Determine the total cost of eliminating six units of pollution using both methods, and enter the amounts in the following table. (Hint: You might need to get information from previous tasks to complete this table.) Proposed Method Total Cost of Eliminating Six Units of Pollution (Dollars) Regulation ?? Tradable Permits ?? In this case, you can conclude that eliminating pollution is ___ costly to society when the government distributes tradable permits than when it regulates each firm to eliminate a certain amount of pollution. ------ Can you please explain this part of the question? Much appreciated.
- Explain why, in the absence of governmental environmental regulation, competitive markets overproduce goods whose production involves the creation of negative externalities. Provide an example of a good that generates a negative externality.Correcting for negative externalities - Regulation versus tradablepermits Suppose a municipality votes to reduce the combined pollution introduced by three local companies. Presently, each firm creates 4 units of pollution in the area, for a total of 12 pollution units. The government can reduce total pollution in the area to 6 units by choosing between the following two methods: Methods to Reduce Pollution 1. The government imposes pollution standards using regulation. 2. The government issues tradable pollution permits. The costs faced by each firm are different, so it is more difficult for some firms to reduce pollution than others. The following table shows the cost faced by each firm to eliminate each unit of pollution. Assume that the cost of eliminating all 4 units of pollution (that is, reducing pollution to zero) is prohibitively expensive for all three firms. Firm Cost of Eliminating the... First Unit of Pollution Second Unit of Pollution…Explain with practical examples four problems that could prevent regulation from leading to the optimal allocation of resources
- How do the concepts of the public interest theory of regulation, political incentives, and economic theory of regulation affect the formulation of environmental regulations?Two identical firms save money from polluting. A firm’s marginal savings from emitting an amount e are given by 10 − 2e. The two firms differ in their impact on ambient pollution concentrations. Two units of emissions from firm 1 result in one unit of ambient pollution, while one unit of emissions from firm 2 results in one unit of ambient pollution. a) Initially the policy-maker decides to institute a standard cap and trade program instead of regulating ambient pollution. If each firm is initially given three emission permits, how many permits will each firm end up with and what will be the price? b) The policy-maker realizes the differences between the firms and de- cides to institute ambient pollution permit trading. What are the transfer coefficients for each of the firms? If instead each firm is given two ambient pollution permits and trading takes place, how much will each firm end up emitting, and what will be the price?Marginal Abatement Costs: The marginal abatement costs of three firms are provided in the table below on page 109. Each firm is emitting now 10 tons/week. Therefore, the total emission of all firms is 30 tons/week. Suppose that society wants to reduce the level of emission by 50%, to 15 tons/week. Calculate the total cost of reducing the level of emission to 15 tons/week Assuming equiproportionate decrease in emissions which of the following is correct: 69 96 100 Assuming equimarginal decrease in emissions which of the following is correct: 69 96 100
- Discuss TWO (2) primary need of government intervention for social regulation.Many observers believe that the levels of pollution in our society are too high. True or False: If society wishes to reduce overall pollution by a certain amount, it is efficient to have firms with highest profit bearing the largest burden of reducing pollution and firms with lowest profit bearing the least burden. Why are command-and-control approaches generally unable to target the firms that should undertake bigger reductions? Check all that apply. Command-and-control approaches often rely on uniform reductions among firms. There is no incentive to reduce pollution beyond the mandated amount. The costs of reducing pollution are the same across firms. Economists argue that appropriate corrective taxes or tradable pollution rights will result in efficient pollution reduction. Which of the following statements support(s) this claim? Check all that apply. Corrective taxes or tradable pollution rights give firms greater incentives to reduce pollution.…Suppose that the market for a certain good has an inverse demand of P = 200 − Q.The aggregate private marginal cost for the firms that produce the good is MC = 20 + Q.However, production of the good also creates pollution with an external marginal cost ofEMC = 10 + Q/2.a) If this is a perfectly competitive market with no regulation, what is theequilibrium price and quantity produced?b) Suppose instead that the market is a monopoly. Calculate the profit-maximizingprice and quantity.c) Determine the socially efficient price and quantity for the good.d) Calculate the socially optimal Pigouvian tax to levy on the competitive firms tomake them produce at the socially efficient level.