Question

The government has recently introduced a marketable permit program for major polluters where one permit gives permission to pollute one unit. When the program is introduced, Firm A emits 400 units of pollutant and so is granted 400 permits. After one year, firms are issued 25% fewer pollution permits. If Firm A reduces its pollutants from 400 units to 260 units, how many permits does it sell after one year?

Answer 1

After the government introduced a marketable permit program and reduced the number of permits by 25%, Firm A, which reduced its pollution from 400 units to 260 units, is able to sell 40 permits after one year.

Step-by-step explanation:

If Firm A originally had 400 permits and the number of permits is reduced by 25% after one year, Firm A would then have 300 permits because 25% of 400 is 100, so 400 - 100 = 300. Now, if Firm A reduced its own pollution from 400 units to 260 units, then it is now using only 260 of the 300 permits it has.

To find out how many permits Firm A can sell, we subtract the number of units it now pollutes from the new number of permits it has: 300 permits - 260 units of pollution = 40 permits. Therefore, Firm A can sell 40 permits after one year.

Answer 2

40

Step-by-step explanation:

The calculation of Permits remaining is shown below:-

New number of permits issued = Emits units of Pollutant × Remaining percentage

= 400 × (100% - 25%)

= 400 × 0.75

= 300

Permits remaining = New number of permits issued - Reduction in units

= 300 - 260

= 40

The company sells 40 permits

Therefore, for computing the permits remaining we simply applied the above formula.