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Figure: City with Two Polluters
-(Figure: City with Two Polluters)Use Figure: City with Two Polluters.If the government wants to limit total pollution to 2 200 tonnes,it could impose an emissions tax of _____ on both firms.
A) $100
B) $200
C) $300
D) $400

Question

Use the following to answer questions :
Figure: City with Two Polluters 
-(Figure: City with Two Polluters)Use Figure: City with Two Polluters.If the government wants to limit total pollution to 2 200 tonnes,it could impose an emissions tax of _____ on both firms.
A) $100 
B) $200 
C) $300 
D) $400

Quizplus · Accepted Answer

To limit total pollution to 2,200 tonnes, both firms will need to emit a total of 1,100 tonnes each (2,200/2). Using the graph, we can see that to emit 1,100, Firm A would need to pay a tax of $150 and Firm B would need to pay a tax of $50. 
Therefore, to limit total pollution to 2,200 tonnes, both firms will need to pay a tax of $300 each (($150 + $50) x 2).

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