Question

first blank options: not used/used

second black: not use/use

3rd: 0/ 0-400/400-800/800-1200

4th: not use/use

5th: 0/0-400/400-800/800-1200

6th: it has property rights to pollute the river/ the resort has property rights to a clean river

8. The effects of property rights on achieving efficiency Consider a river found in the city of Philadelphia, and then answer the questions that follow, The city has a resort whose visitors use the river for recreation. The city also has a research lab that dumps industrial waste into the river. This pollutes the river and makes it a less desirable vacation destination. That is, the research lab's waste decreases the resort's economic profit. Suppose that the research lab could use a different production method that involves recycling water. This would reduce the pollution in the river to levels safe for recreation, and the resort would no longer be affected. If the research lab uses the recycling method, then the research lab's economic profit is $1,400 per week, and the resort's economic profit is $2,700 per week. If the research lab does not use the recycling method, then the research lab's economic profit is $2,200 per week, and the resort's economic profit is $1,500 per week. These figures are summarized in the following table Complete the following table by computing the total profit (the research lab's economic profit and the resort's economic proht combined with and without recycling

Answer 1

Table

Action	total profit
No recycling	3700
Recycling	4100

Blanks

1) total profit Maximum, when recycling method is used

2) research lab will use

3) & pay 0

4) research lab will use

5) resort will pay research lab between 800 & 1200

6) when it has property rights to pollute river

True/ false

option 2) False