Refer Table 1above. The table reveals the marginal abatement costs of three firms related to the quantity of emissions. Each firm is now emitting 10 tons/week, so total emissions are 30 tons/week. Suppose we wish to reduce total emissions by 50 percent, to 15 tons per week. What is the cost of this reduction via an equiproportionate decrease in emissions for each firm?
A) $33
B) $69
C) $72
D) $96

Question

Quizplus · Accepted Answer

An equiproportionate decrease means each firm reduces emissions by 50%, from 10 tons to 5 tons. The cost for each firm to reduce emissions by 5 tons is calculated using their marginal abatement costs. Summing these costs for all firms gives the total cost of the reduction.