Imagine a firm with a marginal abatement cost (MAC) function equal to: MAC = 25 - 5E. The government introduces a cap-and-trade policy and grandfathers the firm 2 permits initially. Assuming the market price of permits is $5, the firm will spend a total of $___ in order to buy permits.
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Imagine a firm with a marginal abatement cost (MAC) function equal to:
MAC = 25 - 5E.
The government introduces a cap-and-trade policy and grandfathers the firm 2 permits initially. Assuming the market price of permits is $5, the firm will spend a total of $___ in order to buy permits.
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- A polluting firm’s marginal abatement cost is MACi = 50 – 0.25ei . If a regulator imposes a per-unit emissions tax of t = 10, what level of emissions does the firm choose under the tax? A polluting firm’s marginal abatement cost is MACi = 50 – 0.25ei . If a regulator imposes a per-unit emissions tax of t = 10, how many units did the firm abate relative to the unregulated environment?In a fishery the long-run harvest function (harvest volume) is H(E) = aE – bE², with a, b representing positive constants and E is fishing effort. Total cost is TC(E)= cE, with c being the unit cost of effort. Total revenue is TR(E) = pH(E), with p being the constant price of fish. Find the open-access equilibrium values of effort and harvest.Imagine a firm with a marginal abatement cost (MAC) function equal to: MAC = 32 - 4E. The government offers a $8 per-unit subsidy for abatement. In principle, the firm could ignore the subsidy and continue to emit as many emissions as it was in the absence of government intervention, but there is money to be made from cutting back its emissions. Compared to ignoring the subsidy, how much money could a cost-minimizing firm save or make by cutting back its emissions? (Hint: remember that firms trade off the benefits of the subsidy with the costs of abatement when deciding how much to abate) Answer:
- Suppose that a chemical manufacturing plant is releasing nitrogen oxides into the air, and these emissions are associated with health and ecological damages. Economists have estimated the following marginal costs and benefits for the chemical market, where Q is monthly output in thousands of pounds and P is price per pound. MSB = 50 – 0.4Q; MSC = 2 + 0.4Q; MEB = 0; MEC = 0.2Q. Find the dollar value of a product charge that would achieve an efficient solution.pik Schiel 0 ( QR Q2 MC2 FIRMI permits метро Firma shing p* > MC₂ will abate QA sell. Wilfrid I permetTwo coal-burning electric power plants are emitting mercury which impairs cognitive development in children. Plant A's marginal abatement cost is MCA= 1.2q and plant B's marginal abatement cost is MCB = 0.3q. Each firm initially emits 50 units and the EPA would like to reduce total emissions to 40. If the EPA follows a command-and-control policy and tells each firm to abate by the same amount, what will be the total costs? If firms could trade permits, what would happen to total costs? Why?
- There is one consumer who is a price taker and a monopoly company that is a price setter. When a consumer buys as much as q at the market price p, benefit B(q)=90q-1/2q^ and spend as much as pq. A monopoly company earn Tr=p-Cq) when it produces as much as q. C(q)=20q+1/2q^ When the exchange volume is q, CE(q)=10q+1/2q^ Find the market equilibrium quantity. Find the efficient quantity. When pigouvian tax is charged, find pigouvian tax per unit .Imagine a firm with a marginal abatement cost (MAC) function equal to: MAC = 100 - 10E. The government introduces a per-unit tax on emissions equal to $20. For a profit-maximizing firm, total compliance costs (total abatement costs plus tax payment) are $____.A polluter is currently being paid an abatement subsidy. The polluter's cost function is MAC = 89 -0.05E. They are being paid $25 per unit to abate. What would be their incentive to lower their abatement costs to MAC = 71.2 - 0.04E? Answer:
- Please help me with this problem. Thank you!Imagine a single firm is facing regulation that would require it to abate its emissions. It has an MAC = 40 + 2A, and when unregulated it would produce 220 units of emissions. ------ a) First, suppose the regulation is a standard that requires this firm to reduce its emissions to 180 units. What is the total cost of abatement to the firm? b) Now suppose the regulator decides to apply a tax of $120 per unit on the firm. How much will the firm pay in abatement now? c) How much will it transfer to the regulator? (Do not include commas in your answer.) d) Draw a graph with the MAC curve of the firm (extend the abatement axis to the unregulated level of emissions), and illustrate the standard and tax level. Show the costs of complying with each regulation from the firm's perspective by labels the total abatement cost area under the standard, under the tax, and the total transfer to the government under the tax. Label the axes, intercepts, and relevant prices and quantities.Suppose that a firm's marginal abatement cost function with existing technologies is MAC = 8 - E. If the firm adopts new pollution abatement technologies, then its marginal abatement cost function will become MAC = 4 - 0.5E. Moreover, assume that the adoption costs for the new technologies are $3. If the government raises the tax on emissions from $1 to $3, then the firm's total costs increase by $__. (Hint: total costs are different from total compliance costs. Total compliance costs are the sum of TAC and tax payment, while total costs are the sum of total compliance costs and adoption costs (remember that adoption costs are only incurred if the firm actually decides to adopt the new technology).) Please round your final ansswer to two decimal places if necessary. Answer: