Two firms can control emissions at the following marginal


Question - Two firms can control emissions at the following marginal costs: MC1 = $200q1, MC2 = $100q2, where q1 and q2 are, respectively, the amount of emissions reduced by the first and second firms. Assume that with no control at all, each firm would be emitting 20 units or a total of 40 units from both firms. What is the cost effective allocation of control responsibility if this is a nouniformly mixed fund pollutant and if the ambient standard is 12.0 ppm and the transfer coefficient are a1 = 0.25 and a2 = 0.5?

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Microeconomics: Two firms can control emissions at the following marginal
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