Refer to the Table above. The firm above faces an emissions charge of $100 per ton/month. If the firm chooses to emit 5 tons/month what is the firm's total cost?
A) $265
B) $600
C) $765
D) $865

Question

Quizplus · Accepted Answer

The firm's total cost for emitting 5 tons/month will be ($100 x 5) + $665 = $765. The best choice for the firm would be to reduce emissions to 4 tons/month, as this would result in a lower cost of ($100 x 4) + $315 = $715.

Refer to the Table Above