ng.cengage.com C | Content MindTap - Cengage Learning CENGAGE | MINDTAP Q Search this cours Homework (Ch 10) 7. Correcting for negative externalities - Taxes versus tradablepermits Automotive assembly plants emit particulate matter as a waste product. This generates a cost to society that is not paid for by the firm; therefore, log and Study Tools pollution is a negative externality of vehicle production. Suppose the U.S. government wants to correct this market failure by getting firms to internalize the cost of pollution. To do this, the government can charge firms for pollution rights (the right to emit a given quantity of particulate al Options matter). The following graph shows the daily demand for pollution rights. ge Success Tips Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. er Success Tips Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. e Feedback Graph Input Tool (? Daily Demand for Pollution Rights Price (Dollars per ton) Quantity 45 Demanded (Millions of tons) PRICE (Dollars per ton) Demand 10 15 20 25 30 35 40 45 50 QUANTITY (Millions of tons) MacBook Air 9- F2 20 F3 868 F4 .. FS -- FO 4. F7 DI FB F9 F10 40)) F12 2 5 6 Q W E R O Dng.cengage.com C hill | Content Mind Tap - Cengage Learning K