Suppose Michigan's NO_X Abatement Standard for Existing (E) Sources Is

question 22

Multiple Choice

Suppose Michigan's NO_X abatement standard for existing (E) sources is 4 units and the EPA's standard for new (N) sources is 10 units and that MAC_E = 1.8A_E and MAC_N = 1.2A_N. To meet the same combined abatement level of 14 but in a cost-effective manner, the standards for each should be

• A) A_E = 7; A_N = 7
• B) A_E = 4.8; A_N = 7.2
• C) A_E = 5.6; A_N = 8.4
• D) none of the above

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Definitions:

Gross Investment

represents the total amount spent on purchases of new capital and on replacing depreciated capital within an economy during a specified period.

Capital Stock

The total amount of physical, financial, and human assets used in the production of goods and services in an economy.

Proprietorships

Businesses owned and operated by a single individual, bearing full responsibility for its assets and liabilities.

Partnerships

A business structure in which two or more individuals manage and operate a business in accordance with the terms and objectives set out in a Partnership Agreement.