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Among the identified point sources contributing to the pollution of Puget Sound are Dow Chemical (D) and Chevron (C). Each firm's cost functions are shown below.
MACD = 2.5AD MACC = 3.75AC
TACD = 1.25AD2 TACC = 1.875AC2
To meet the effluent limits under the Clean Water Act, each firm has an NPDES permit to release some fixed amount of effluents, so each must abate 30 units.
a. At the uniform abatement standard described above, find total abatement costs for both firms.
b. Instead of a uniform standard, suppose each firm faces a volume-based, marginal effluent fee (MEF) of $90. How much will each firm abate?
c.. If each firm's production is associated with the release of 50 units of effluent, how much will each pay in total effluent fees when facing the $90 marginal effluent fee?
Pollution
The introduction of contaminants into the natural environment, causing adverse change and harm to ecosystems, human health, or property.
Air Pollution Control Technology
Technologies and methods used to reduce or eliminate the emission of pollutants into the atmosphere.
Clean Air Act
A United States federal law designed to control air pollution on a national level by setting emissions standards for sources like automobiles and industrial facilities.
NEPA
NEPA stands for the National Environmental Policy Act, a United States environmental law that promotes the enhancement of the environment and established the President's Council on Environmental Quality (CEQ).
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