Chapter 31: Q. 31.3LO (page 692)
Describe how governments are trying to cap the use of pollution-generating resources
Breezes can grab radioactive particles that's been spilled inadvertently from such a nuclear reactor or distribute it across the globe
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Under an agreement with U.S. regulators, American Electric Power Company of Columbus, Ohio, has agreed to offset part of its million metric tons of carbon dioxide emissions by paying another company to lay plastic tarps. These tarps cover farm lagoons holding rotting livestock wastes that emit methane gas times more damaging to the atmosphere than carbon dioxide. The annual methane produced by a typical pound cow translates into about metric tons of carbon dioxide emissions per year.
a. How many cows' worth of manure would have to be covered to offset the carbon dioxide emissions of this single electric utility?
b. Given that there are about 9 million cows in the United States in a typical year, what percentage of its carbon dioxide emissions could this firm offset if it paid for all cow manure in the entire nation to be covered with tarps?
How would the relocation of pollution-generating Chinese plants to other nations affect the optimal degree of air cleanliness in China? Explain briefly.
The market price of insecticide is initially per unit. To address a negative externality in this market, the government decides to charge producers of insecticide for the privilege of polluting during the production process. A fee that fully takes into account the social costs of pollution is determined, and once it is put into effect, the market supply curve for insecticide shifts upward by per unit. The market price of insecticide also increases, to per unit. What fee is the government charging insecticide manufacturers?
Why might allowing profit-maximizing firms to manage the hunting of particular endangered animals potentially help to ensure the animals' species would not disappear? (Hint: Would a company continue to generate profits from selling hunting rights if it allowed hunters to kill all of the animals that it manages?)
Contrast the roles of private and common property rights in problems such as the fates of endangered species
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