Use the Following to Answer Question

question 69

Multiple Choice

Use the following to answer question:
Figure: City with Two Polluters
-(Figure: City with Two Polluters) Use Figure: City with Two Polluters.If the government imposed an emissions tax of $400,firm A would produce _____ tons of pollution and firm B would produce _____ tons of pollution.

• A)200;400
• B)400;1,200
• C)800;1,400
• D)1,200;1,600

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Definitions:

Physical Capital

Physical capital refers to tangible assets used in the production of goods and services, such as machinery, buildings, and equipment.

Terms of Trade

The ratio at which a country's exports exchange for its imports, affecting the economy's health.

Heckscher-Ohlin Theorem

An economic theory stating that countries export what they can most efficiently and plentifully produce, based on their factor endowments of labor, land, and capital.

Trade Flows

The movement of goods and services between countries or regions, highlighting the patterns and volumes of trade.