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Suppose There Are Steel Manufacturing Firms (Firm a and Firm

Question 101

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Suppose there are steel manufacturing firms (firm A and firm B.in a city which release 20 units and 16 units of pollutants every year in the absence of any restriction.The government then issues tradable permits to pollute to each of the firms.The overall emission level allowed through the permits was set at 6 units for each firm.Explain with the help of a suitable figure that how the government achieves a target of reducing pollution by 24 units in the least costly way.

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