Question

In: Economics

Workers and retirees live together in a neighborhood with emissions from a nearby factory causing pollution....

Workers and retirees live together in a neighborhood with emissions from a nearby factory causing pollution. The marginal damages for workers is 2e and the marginal damages for the retirees is 6e. The polluting factory has a marginal savings of 20 − 2e.

1) What is the MPB of workers and retirees? What is the aggregate MSB?

2) what is the factory's marginal abatement cost (MAC)?

3) whats the optimal abatement level?

Solutions

Expert Solution

Rahul Sunny answered 1 year ago
Next > < Previous

Related Solutions

A cement factory pollutes a nearby restaurant. The pollution reduces the profit of the restaurant by...
A cement factory pollutes a nearby restaurant. The pollution reduces the profit of the restaurant by $500,000. The restaurant could install equipment to clear the pollution but that would cost $250,000. Alternatively, the factory could install equipment to prevent the pollution at a cost of $350,000. a. Discuss the Pigouvian solution. b. Discuss the Coasean solution if the restaurant has the right to a pollution free environment. Also discuss the Coasean solution if the factory has the right to pollute....
3. A cement factory pollutes a nearby restaurant. The pollution reduces the profit of the restaurant...
3. A cement factory pollutes a nearby restaurant. The pollution reduces the profit of the restaurant by $500,000. The restaurant could install equipment to clear the pollution but that would cost $250,000. Alternatively, the factory could install equipment to prevent the pollution at a cost of $350,000. a. Discuss the Pigouvian solution. b. Discuss the Coasean solution if the restaurant has the right to a pollution free environment. Also discuss the Coasean solution if the factory has the right to...
A factory located in an urban neighborhood is causing controversy. Some people protest the factory’s harmful...
A factory located in an urban neighborhood is causing controversy. Some people protest the factory’s harmful environmental emissions. Others point to job opportunities that the factory provides for community members. A local community organization surveys a random sample of 200 residents of the neighborhood and finds that 43% of the respondents agree with a statement calling for the factory to close. What is the 99% confidence interval for π, the population proportion of neighborhood residents who agree that the factory...
In a study of exhaust emissions from school buses, the pollution intake by passengers was determined...
In a study of exhaust emissions from school buses, the pollution intake by passengers was determined for a sample of 9 school buses used in the Southern California Air Basin. The pollution intake is the amount of exhaust emissions, in grams per person, that would be breathed in while traveling on the bus during its usual 18-mile trip on congested freeways from South Central LA to a magnet school in West LA. (As a reference, the average intake of motor...
In a study of exhaust emissions from school buses, the pollution intake by passengers was determined...
In a study of exhaust emissions from school buses, the pollution intake by passengers was determined for a sample of nine school buses used in the Southern California Air Basin. The pollution intake is the amount of exhaust emissions, in grams per person, that would be inhaled while traveling on the bus during its usual 18-mile trip on congested freeways from South Central LA to a magnet school in West LA. Here are the amounts for the nine buses when...
Suppose a community faces a pollution problem because of emissions from a polluter with MAC =...
Suppose a community faces a pollution problem because of emissions from a polluter with MAC = 36 - 21 The information on pollution damages is given by MD = E (a) If there is a tax rate on emissions of \$ 9/unit , then what is the emission level choosen by the polluter in equilibrium? What is the amount of its compliance costs? (b) What is the socially efficient tax rate in the given situaton? () Now imagine a situation...
Suppose powerplant emissions are linked to morbidity and mortality in humans who live downwind from the...
Suppose powerplant emissions are linked to morbidity and mortality in humans who live downwind from the powerplant. Suppose in recent years the daily load of emissions into the environment has averaged 4.0 million tons. Also suppose that since the generation of electricity is an important public service the Environmental Protection Agency is reluctant restrict electricity generation. A recent study compiled by the Green Party, an environmental organization, determined that the marginal benefits (in $’s per million tons) of abating emissions...
In a sample of 80 workers from a factory in city A, it was found that...
In a sample of 80 workers from a factory in city A, it was found that 10% were unable to read, while in a sample of 50 workers in city B, 14% were unable to read. Can it be concluded that there is a difference in the proportions of nonreaders in the two cities? Use α = 0.10. Also find the 90% confidence interval for the differences of the two proportions.
18. Suppose a community faces a pollution problem because of emissions from a polluter with MAC=36-...
18. Suppose a community faces a pollution problem because of emissions from a polluter with MAC=36- 2E. The information on pollution damages is given by MD=E . (a) If there is a tax rate on emissions of $ 9/unit, then what is the emission level choosen by the polluter in equilibrium? What is the amount of its compliance costs? (b) What is the socially efficient tax rate in the given situation? (c) Now imagine a situation where the polluter bargains...
Suppose a community faces a pollution problem because of emissions from a polluter with MAC=36- 2E....
Suppose a community faces a pollution problem because of emissions from a polluter with MAC=36- 2E. The information on pollution damages is given by MD=E . (a) If there is a tax rate on emissions of $ 9/unit, then what is the emission level choosen by the polluter in equilibrium? What is the amount of its compliance costs? (b) What is the socially efficient tax rate in the given situaton? (c) Now imagine a situation where the polluter bargains with...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT