3. The table below depicts the marginal cleanup costs for Springfield's two polluters, ACME Corp. and Bluth Industries. Currently, each firm is polluting 100 units (for an industry total of 200 units). However, regulators have decided that the total amount of pollution in Springfield needs to be cut in half. Marginal Marginal Cleanup. Level (A or B) Cleanup Cost Cleanup Cost ACME Bluth 10 15 10 20 20 12 30 30 16 40 45 22 50 65 30 60 90 45 70 120 65 a) Suppose regulators adopt a command-and-control pollution standard that forces each firm to reduce pollution by the same amount, going from 100 units down to 50 units. What is the total cost of cleanup under this regulation? b) Suppose, instead, that regulators adopt pollution taxes. What tax level would guarantee the same outcome? Under the tax, how much pollution would each firm clean up? What is the total cost of cleanup under this regulation? How much tax revenue would the tax generate? c) If regulators were to implement cap-and-trade, how many total permits would they need to issue to guarantee the same outcome from part a)? How many permits would each firm purchase if regulators were to auction them off?

How can high-income countries benefit from covering much of the cost of reducing pollution created by low-income countries?

EOC 11.04 Two businesses, X and Y, each dump 20 tonnes of pollution into a creek. In an effort to reduce pollution, the government will now require businesses to have a pollution permit to dump pollutants in the creek. Each business receives 10 pollution permits and they can use it to pollute or sell it to the other business (but lose the ability to pollute). To reduce pollution it costs business X $100 per tonne of pollutant eliminated and it costs business Y $50 per tonne of pollutant eliminated. Once the two businesses have traded these permits with each other, what is the likely outcome? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a business X emits 10 tonnes of pollutants and business Y emits 10 tonnes of pollutants. b business X no longer pollutes, and business Y will not lower the amount it pollutes. business X raises its pollution, and business Y will lower how much it pollutes. business Y no longer pollutes, and…

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