The table below gives the marginal abatement costs of three polluting firms inan industry. The industry is regulated with an emission tax of $6.Marginal abatements costs ($/ton)Emissions(tons/week)10Firm 1 Firm 2 Firm 30 02342123184.51024412366.3146018728.23842910810a. What level of emissions does each firm choose? Explain how they respond to the emissionstax.b. What are cach firm's total compliance costs? Show your work.c. What is the total level of abatement? Discuss whether this abatement is achieved at the leastcost for society.

Abatement or Reduction costs are costs of reducing environmental harm such as pollution. Marginal or…

The table below gives the marginal abatement costs of three polluting firms in an industry. The industry is regulated with an emission tax of $6. Marginal abatements costs ($/ton) Emissions (tons/week) Firm I Firm 2 Fim 3 0 00 10 9. 3 8. 4 6. 2 6 12 3 8. 18 4 10 24 12 36 3 14 60 7 2 18 72 8. 23 84

The table below gives the marginal abatement costs of three polluting firms in an industry. The industry is regulated with an emission tax of $6. Marginal abatements costs ($/ton) Emissions (tons/week) Firm I Firm 2 Fim 3 0 00 10 9. 3 8. 4 6. 2 6 12 3 8. 18 4 10 24 12 36 3 14 60 7 2 18 72 8. 23 84

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter12: Environmental Protection And Negative Externalities

Section: Chapter Questions

Problem 6SCQ: Classify the following pollution-control policies as command-and-control or market incentive based....

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Question

The table below gives the marginal abatement costs of three polluting firms in
an industry. The industry is regulated with an emission tax of $6.
Marginal abatements costs ($/ton)
Emissions
(tons/week)
10
Firm 1 Firm 2 Firm 3
0 0
2
3
4
2
12
3
18
4.
5
10
24
4
12
36
6.
3
14
60
18
72
8.
23
84
29
108
10
a. What level of emissions does each firm choose? Explain how they respond to the emissions
tax.
b. What are cach firm's total compliance costs? Show your work.
c. What is the total level of abatement? Discuss whether this abatement is achieved at the least
cost for society.

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