# Question: The EPA wants to reduce emissions of sulfur dioxides from

The EPA wants to reduce emissions of sulfur dioxides from electric power-generating plants by 20 percent during the next year. To achieve this goal, the EPA will require each power-generating plant in the nation to reduce emissions by 100 tons per year. Suppose five power plants emit sulfur dioxides and serve a given metropolitan area. The following table shows the cost per ton of reducing emissions for each of the five plants:
COST PER TON EMISSIONS
OF PLANT REDUCTION
1 ............ \$600
2 ............ 500
3 ............ 500
4 ............ 400
5 ............ 200
Assuming that the cost per ton of emissions reduction is constant and that the improvement in the air for the metropolitan area is the same no matter which plant reduces emissions, calculate the following:
a. Cost of meeting EPA regulations.
b. Least-cost method of achieving the EPA goal of reducing emissions of sulfur dioxides from power plants in the metropolitan area.

View Solution:

Sales0
Views111