The Filthy Chemical Company dumps 100 tons of pollutants every year in the Pristine Lake. The Trout Fishing Co., the only other user of the lake,estimates that if Q tons of pollution were cleaned up every year its profits would rise according to the relation Filthy estimates it can clean the pollutants at constant average costs of $2 per ton. (a) In the interest of efficiency, how much pollution should be cleaned up every year? (b) Suppose Filthy bought Trout. How much would it clean up? What if Trout bought Filthy?

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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The Filthy Chemical Company dumps 100 tons of
pollutants every year in the Pristine Lake. The
Trout Fishing Co., the only other user of the
lake,estimates that if Q tons of pollution were
cleaned up every year its profits would rise
according to the relation
Filthy estimates it can clean the pollutants at
constant average costs of $2 per ton.
(a) In the interest of efficiency, how much
pollution should be cleaned up every year?
(b) Suppose Filthy bought Trout. How much
would it clean up? What if Trout bought Filthy?
Transcribed Image Text:The Filthy Chemical Company dumps 100 tons of pollutants every year in the Pristine Lake. The Trout Fishing Co., the only other user of the lake,estimates that if Q tons of pollution were cleaned up every year its profits would rise according to the relation Filthy estimates it can clean the pollutants at constant average costs of $2 per ton. (a) In the interest of efficiency, how much pollution should be cleaned up every year? (b) Suppose Filthy bought Trout. How much would it clean up? What if Trout bought Filthy?
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