The Diagram Below Shows the Marginal Cost of Pollution Abatement

question 7

Multiple Choice

The diagram below shows the marginal cost of pollution abatement for two firms,Firm X and Firm Y.
FIGURE 17-6
-Refer to Figure 17-6.Firms X and Y have an emissions tax of $t imposed on each unit of pollution they produce.If Firm X chooses to abate QX units of pollution,the total cost of its abatement is

• A)tax amount t multiplied by the maximum possible level of pollution abatement.
• B)area beneath the marginal cost of pollution abatement curve.
• C)area below the horizontal line at t and above the MC of pollution abatement curve.
• D)tax amount t multiplied by the level of pollution abatement,QX.
• E)area beneath the marginal cost of pollution abatement curve up to QX.

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