Imagine a firm with a marginal abatement cost (MAC) function equal to:MAC = 30- 6E.The government introduces a cap-and-trade policy and grandfathers the firm 1 permit initially. Assuming the market price ofpermits is $6, the firm will spend a total of $_ in order to buy permits.(Note: your answer can be positive or negative; if it is positive, the firm buys permits and your answer represents the firm'stotal expenditures on permits; if it is negative, the firm sells permits and your answer represents the firm's total revenuesfrom selling permits).(Round your answer to the nearest integer)Answer:

The costs that are being used for decreasing an additional pollution unit are known as marginal…

Answered: Imagine a firm with a marginal…

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter28: Antitrust And Regulation

Section: Chapter Questions

Problem 7E

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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:
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:
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.
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 be MAC = 4 - 0.5E. If the government raises the tax on emissions from $1 to $3, then the benefits of adopting new technologies increase by $_. (Hint: when not considering adoption costs, benefits are simply defined by changes in total compliance costs.) Please round your final answer to two decimal places if necessary. Answer:
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:
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?
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 .
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.
Gozilla Inc. can generate 100 (CO2) emissions without any regulation. The marginal control cost for Gozilla Inc., associated with emission reduction, is known MC=20+0.5Q where Q is reduced units. Suppose that the regulator impose an emission standard on Gozilla: According to the emission standard, the factory is allowed to emit 40 units. The level of reduction in the emission standard could be accomplished through an emission charge (quantity tax or penalty fee on emission). An emission charge of per emission unit would generate the target amount of reduction. Total (tax) revenue the regulator will collect as emission charges would be Hint: Type integers. Do not use thousands separators.
Suppose that a firm's marginal abatement cost function with existing technologies is MAC = 12 - E. If the firm adopts new pollution abatement technologies, then its marginal abatement cost function will become MAC = 6 - 0.5E. If the government raises the tax on emissions from $2 to $3, then the benefits of adopting the new technologies increase by $ (Hint: when not considering adoption costs, benefits are simply defined by changes in total compliance costs.) Please round your final answer to two decimal places if necessary. Answer:
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 answer to two decimal places if necessary. THE ANSWER IS NOT 9
A chemical company can produce Q units of a chemical H, with marginal costs of MC = 9 + Q, and can distribute the chemical at marketing marginal costs of MC = 1. The demand for H is given by P = 30 - 1.5Q. If an external market exists where H can be bought or sold without marketing expenses for $13, how much H should the firm produce? 4 units 10 units 7 units 5 units 0 units

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