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Figure: City with Two Polluters
-(Figure: City with Two Polluters)Use Figure: City with Two Polluters.If the government does not intervene in the pollution market,equilibrium will occur where firm A produces _____ tons of pollution and firm B produces _____ tons of pollution,for a total of _____ tons.
A)2,000;2,000;4,000
B)0;1,000;1,000
C)1,000;0;1,000
D)800;1,400;2,200

Question

Use the following to answer question:
Figure: City with Two Polluters 
-(Figure: City with Two Polluters)Use Figure: City with Two Polluters.If the government does not intervene in the pollution market,equilibrium will occur where firm A produces _____ tons of pollution and firm B produces _____ tons of pollution,for a total of _____ tons.
A)2,000;2,000;4,000 
B)0;1,000;1,000 
C)1,000;0;1,000 
D)800;1,400;2,200

Quizplus · Accepted Answer

Without government intervention, each firm will produce at its maximum capacity without considering the external costs of pollution, leading to a total of 4,000 tons of pollution if both firms produce 2,000 tons each.

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