Two Firms, a and B, Each Currently Emit 100 Tons

question 456

Multiple Choice

Two firms, A and B, each currently emit 100 tons of chemicals into the air. The government has decided to reduce the pollution and from now on will require a pollution permit for each ton of pollution emitted into the air. The government gives each firm 40 pollution permits, which it can either use or sell to the other firm. It costs Firm A $200 for each ton of pollution that it eliminates before it is emitted into the air, and it costs Firm B $100 for each ton of pollution that it eliminates before it is emitted into the air. It is likely that

• A)Firm A will buy all of Firm B's pollution permits. Each one will cost between $100 and $200.
• B)Firm B will buy all of Firm A's pollution permits. Each one will cost between $100 and $200.
• C)Both firms will use their own pollution permits.
• D)Firm A will buy some of Firm B's pollution permits. Each one will cost less than $100.

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Definitions:

Beat

The basic unit of time in musical rhythm, or the act of striking something to produce a sound or indicate rhythm.

Ventricles

The two lower chambers of the heart that receive blood from the atria and pump it out to the body and lungs.

Cycle

A sequence or series of events that recur regularly and usually lead back to the starting point.

Heart Rhythm

The sequence of heartbeats, including their speed and rhythm, which can be regular or irregular depending on the heart's electrical activity.