Refer to Table 1

question 28

Multiple Choice

Refer to Table 1. If the firms above faced an emissions tax of $12, what level of total abatement costs would be expended?

• A) 33
• B) 57
• C) $36 in abatement costs and $36 in taxes
• D) $21 in abatement costs and $36 in taxes

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Definitions:

Variable Costs

Outlays that adjust in response to the volume of production or sales figures.

Fixed Manufacturing Overhead

Represents the production costs that do not change with the level of manufacturing activity, such as salaries of managerial staff and rent of the factory.

Milling Machine

A machine tool used to machine solid materials by rotating a cutting tool to remove material.

Constrained Resource

A limiting factor in production or project management that restricts output, such as limited materials, labor, or machine capacity.