Suppose there are two plants that are emitting sulphur


Suppose there are two plants that are emitting sulphur dioxide into the air and polluting the environment. One plant has a higher marginal benefit curve than the other. Draw and label a graph illustrating the impact of imposing a uniform environmental standard on the two plants. In a separate graph, show the effects of imposing an emission tax on the two plants. Which policy is more economically efficient and why? Explain how a cap and trade program can lead to a socially optimal outcome.

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Business Economics: Suppose there are two plants that are emitting sulphur
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