Instead of using regulations to achieve the 20 percent reduction in emissions discussed in the preceding problem, suppose the EPA requires each of the five emitters to pay a fee of $450 for each ton of sulfur dioxide it dumps in the air during the year. Use the data from the table for problem 3 to predict which companies will purchase pollution rights, total cost of achieving the reduction in sulfur dioxide emissions, and revenue generated from the sale of pollution rights in the area.

Transcribed Image Text:

PLANT COST PER TON OF PLANT FOR EMISSIONS REDUCTION 1 $600 2 500 3 500 4 400 200 NMt 5