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The Figure Below Shows the Marginal Pollution Abatement Cost Curves

Question 45

Multiple Choice

The figure below shows the marginal pollution abatement cost curves of two firms- Company X and Company Y.
The figure below shows the marginal pollution abatement cost curves of two firms- Company X and Company Y.    -Refer to the figure above. Which of the following will happen if the government allocates 30 pollution permits to each company and the price of each permit is $1,500? A)  Company X will sell 10 permits to Company Y. B)  Company X will sell 20 permits to Company Y. C)  Company X will buy 20 permits from Company Y. D)  Company X will buy 10 permits from Company Y.
-Refer to the figure above. Which of the following will happen if the government allocates 30 pollution permits to each company and the price of each permit is $1,500?


A) Company X will sell 10 permits to Company Y.
B) Company X will sell 20 permits to Company Y.
C) Company X will buy 20 permits from Company Y.
D) Company X will buy 10 permits from Company Y.

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