Every extra PS1 spent on abatement reduces pollution by one half a tonne. Pollution falls non-linearly as abatement expenditure rises. Network externalities cause number of safe passages to increase. Between E1 and E2 expenditure encounters decreasing marginal returns.
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Every extra PS1 spent on abatement reduces pollution by one half a tonne. Pollution falls non-linearly as abatement expenditure rises. Network externalities cause number of safe passages to increase. Between E1 and E2 expenditure encounters decreasing marginal returns.
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Every extra PS1 spent on abatement reduces pollution by one half a tonne. Pollution falls non-linearly as abatement expenditure rises. Network externalities cause number of safe passages to increase. Between E1 and E2 expenditure encounters decreasing marginal returns.
Direitos autorais:
Attribution Non-Commercial (BY-NC)
Formatos disponíveis
Baixe no formato PPT, PDF, TXT ou leia online no Scribd
= The slope of the line indicates the marginal reduction in
pollution for every increase of £1 of abatement expenditure. = It is constant at 0.5 indicating that every extra £1 spent on abatement reduces pollution by one half a tonne. #$ ! "
= In this example, pollution falls non-linearly as abatement
expenditure rises. = When pollution is 8,000 tonnes per year an additional expenditure of £3,000 reduces pollution by 2,000 tonnes. = The marginal return for £1 additional expenditure is Ê or 2,000/3,000 which is 2/3rd of a tonne per £1 spent on abatement. = When pollution has already been reduced to 3,000 tonnes, an extra £3000 spent on abatement only reduces pollution by 500 tonnes. = The marginal return for £1 of additional expenditure, Ê is now only 500/3000 or one sixth of a tonne per £1 spent. % & '(
= In this example, network externalities cause the number of safe
passages to increase at an increasing rate as more is spent on navigational aids. = For example, an increase in expenditure on navigational aids by £3,000 when expenditure is £6,000 raises safe passages by 500 from 3,500 to 4,000. = The marginal return to £1 extra on navigational aids is 500/3,000 or 0.167it takes £60 to get one more safe passage (3,000/500). = However, when 14,000 is already being spent, a further increase of £3,000 increases safe passages by 2,000 from 6,000 to 8,000. = The marginal return from £1 spent on aids is now 2,000/3,000 or 0.667it only takes £1.5 extra spending to get one more safe passage (3,000/2,000). )'
= ÷p to , expenditure on navigation aids encounters
increasing marginal returns. = Îetween and expenditure encounters decreasing marginal returns. = |ach additional £1 spent increases the number of safe passages by less than the previous £1 of expenditure. = At safe passages reach a maximum of . = Further expenditures encounter negative marginal returns. = |ach additional £1 spent lowers the number of safe passages. *+! "
= ÷p to , each additional £1 of expenditure reduces pollution,
but at a diminishing amount for each £1. = At expenditure , pollution reaches a minimum of Ê. = If further amounts are spent, pollution actually rises.