Econ 101 Class 18 Questions 1. The following table gives the value of a mill and the value of a fishery as a function of the mill’s pollution decision Pollution Decision Value of Mill Value of Fishery High Discharge Rate $5000 $2000 Low Discharge Rate $1000 $3000 If the Fishery has the right to block the mill from a high rate of discharge of pollution then… 2. Suppose three companies in the Ohio Valley each produce 1000 tons of S02 per year. The EPA has decided to reduce emissions by 1200 tons per year. The following table gives the marginal cost per ton of reducing emissions. SO2 Reduction Marginal Cost per Ton of SO2 Reduction Firm A
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