Suppose There Are Three Power-Generating Plants, Each of Which Has

question 56

Multiple Choice

Suppose there are three power-generating plants, each of which has access to 5 different production processes. The table below summarizes the cost of each production process and the corresponding number of tons of smoke emitted each. $\begin{array}{|c|c|c|c|c|c|}\hline \text { Process } & \text { A } & \text { B } & \text { C } & \text { D } & \text { E } \\\text { (smoke/day) } & \text { (4 tons/day) } & \text { (3 tons/day) } & \text { (2 tons/day) } & (1 \text { ton/day) } & \text { (0 tons/day) } \\\hline \text { Cost to Firm } X(\$ / \text { day) } & \$ 500 & \$ 514 & \$ 530 & \$ 555 & \$ 585 \\\hline \text { Cost to Firm Y (\$/day) } & \$ 400 & \$ 420 & \$ 445 & \$ 480 & \$ 520 \\\hline \text { Cost to Firm Z(\$/day) } & \$ 300 & \$ 325 & \$ 360 & \$ 400 & \$ 550 \\\hline\end{array}$
Suppose the government decides to impose a tax on each ton of smoke emitted. What would be the lowest tax, in whole dollars, that would reduce emissions to 6 tons per day?

• A)$21 per ton
• B)$26 per ton
• C)$36 per ton
• D)$41 per ton

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