sewage emissions for this city.

b. What is the optimal level of sewage for this city? How can you tell?

44. In the Land of Purity, there is only one form of pollution, called “gunk.” Table 12.14 shows possible

combinations of economic output and reduction of gunk, depending on what kinds of environmental

regulations you choose.

Combos Eco Output Gunk Cleaned Up

J

K

L

M

N

800

500

600

400

100

TABLE 12.14

10%

30%

40%

40%

90%

a. Sketch a graph of a production possibility frontier with environmental quality on the horizontal axis,

measured by the percentage reduction of gunk, and with the quantity of economic output on the

vertical axis.

b. Which choices display productive efficiency? How can you tell?

c. Which choices show allocative efficiency? How can you tell?

d.

e.

f.

In the choice between K and L, can you say which one is better and why?

In the choice between K and N, can you say which one is better, and why?
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