Refer to the Data Provided in Table 16 -Refer to Table 16

question 124

Multiple Choice

Refer to the data provided in Table 16.4 below to answer the following question(s) .
Table 16.4 shows the situation facing two firms, both of which are polluting. Assume that each firm emits 5 units of pollution.
Table 16.4
$$\begin{array} { | c | c | c | c | c | c | } \hline \text { Firm A } & \text { Firm A } & \text { Firm A } & \text { Firm B } & \text { Firm B } & \text { Firm B } \\\hline \begin{array} { c } \text { Reduction of } \\\text { Pollution by } \\\text { Firm A }\end{array} & \begin{array} { c } M C \text { of } \\\text { reducing } \\\text { pollution for } \\\text { Firm A }\end{array} & \begin{array} { c } T C \text { of } \\\text { reducing } \\\text { pollution for } \\\text { Firm A }\end{array} & \begin{array} { c } \text { Reduction of } \\\text { Pollution by } \\\text { Firm B }\end{array} & \begin{array} { c } M C \text { of } \\\text { reducing } \\\text { pollution for } \\\text { Firm B }\end{array} & \begin{array} { c } T C \text { of } \\\text { reducing } \\\text { pollution for } \\\text { Firm B }\end{array} \\\hline 1 & \$ 2 & \$ 2 & 1 & \$ 16 & \$ 16 \\\hline 2 & 6 & 8 & 2 & 24 & 40 \\\hline 3 & 12 & 20 & 3 & 32 & 72 \\\hline 4 & 20 & 40 & 4 & 40 & 112 \\\hline 5 & 30 & 70 & 5 & 48 & 160 \\\hline\end{array}$$
-Refer to Table 16.4. Suppose the government wants to reduce the total amount of pollution from the current level of 10 to 4. To do this, the government caps each firm's emissions at 2 units and issues 2 permits to each firm. If firms are not allowed to trade permits, what is the total cost of the pollution reduction?

• A) $48
• B) $92
• C) $152
• D) $230

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Definitions:

Check Deduction

A payroll or accounting action where a specific amount of money is subtracted directly from an employee's paycheck.

Bank Liability

The legal responsibilities and obligations a bank has towards its customers, such as ensuring the security of deposits and providing accurate account information.

Unauthorized Signatures

Signatures made without the express permission or authority of the person whose signature is required or expected.

Customer Signatures

Signatures of customers, typically collected for verification purposes, authorization, or agreement to terms and conditions.