See attached environmental economics 2. Suppose that the Marginal Abatement Cost function and the Marginal Damage functionfor an industry are given as follows:MAC-80-0.2eMD = 0.3eFor simplicity here, we are assuming that they are linear.a.Graph the MAC and MD curves for this industry. Make sure you are marking outany and all relevant axis intercepts.b. Suppose that the industry is completely unregulated. What is the uncontrolledlevel of emissions?c. Calculate the actual dollar amount of the total damages incurred to society at theuncontrolled level of emissions. How did you find your answer?d. Suppose that the government implements strong liability laws hold pollutersfinancially accountable for any damages that they cause society as a policy. Ifthese laws are sufficiently rigorous and the court system perfectly upholds them,what should be expected to be the level of pollution in the industry? Explain yourreasoning.e. If the polluters have to compensate affected parties financially for any damages,what is the dollar amount of these damage payments at the level of emissionsfound in part d? How did you find your answer?f. What is the total cost to firms of this policy? How did you find your answer.g. What is the total cost to the rest of society of this policy?h. To society, what is the total benefit of this policy? Explain how you found youranswer.

Marginal Abatement Cost = 80 -0.2eMarginal Damage = 0.3e

Suppose that the Marginal Abatement Cost function and the Marginal Damage function for an industry are given as follows: MAC = 80 -0.2e MD = 0.3e For simplicity here, we are assuming that they are linear. a. Graph the MAC and MD curves for this industry. Make sure you are marking out any and all relevant axis intercepts.

Suppose that the Marginal Abatement Cost function and the Marginal Damage function for an industry are given as follows: MAC = 80 -0.2e MD = 0.3e For simplicity here, we are assuming that they are linear. a. Graph the MAC and MD curves for this industry. Make sure you are marking out any and all relevant axis intercepts.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter10: Prices, Output, And Strategy: Pure And Monopolistic Competition

Section: Chapter Questions

Problem 3E

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