The Diagram Below Shows the Marginal Cost of Pollution Abatement

question 38

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 Q_X 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,Q_X.
• E)area beneath the marginal cost of pollution abatement curve up to Q_X.

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Definitions:

Correlation Coefficient

A statistical measure that indicates the extent to which two variables fluctuate together.

Relationship

Refers to a connection, whether emotional, social, or professional, that exists between individuals, groups, or entities, characterized by mutual interactions and dependence.

Variables

Elements, characteristics, or features that can change or vary in a research or experimental setting, influencing or reflecting the outcomes.

Correlation

A statistical measure that indicates the extent to which two or more variables fluctuate together, showing the strength and direction of a relationship.