Question

A manufacturing plant emits air pollution when producing output. Suppose the marginal benefit (MB) of reducing air pollution to society is MC 360 MB 300-Q EMC The government expects the marginal cost (EMC) of reducing air pollution for the manufacturing plant to be о 270 240 EMC Q E 210 However, the actual marginal cost of reducing air pollution for the plant is $60 higher per unit. D 180 15 What emissions fee would the government set to reduce the amount of air pollution it believes to be optimal? Assume the government uses the expected marginal cost of reducing air pollution in its calculations 120 90 D 60 The government would set an emissions fee of $ per unit. (Enter a numeric response using a real number rounded to two decimal places.,) 30 MB 0 30 60 90 120 150 180 210 240 270 300 330 Using the triangle drawing tool, shade in the deadweight loss (DWL) from the emissions fee given the actual cost of the manufacturing plant reducing air pollution. Attach the provided label Q, Units of smog abated per day Deadweight loss from the emissions fee is S. (Enter a numeric response using a real number rounded to two decimal places.)

Answer 1

AB Emission Fees ( o, 1 20) 120) So nttulį.would sel a. Emise.. n lees 악 f(60 pe Unil t (t80-120) 60 ol 2