The table presents a firm with four alternative methods of production for achieving its planned output. Each method involves a different cost and creates a different amount of pollution. Government rules require polluting firms to purchase pollution permits, and each permit costs $90. One permit allows the firm to release 1 tonne of pollution. Pollution cannot be released unless a permit has been bought. Which method of production has the lowest total cost?
- Aproduction cost $320; pollution 3 tonnes
- Bproduction cost $380; pollution 2 tonnes
- Cproduction cost $480; pollution 1 tonne
- Dproduction cost $700; pollution 0 tonnes