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Consider a "market for pollution'' where the marginal abatement cost is given by ???(?)=300−2?MAC(e)=300−2e and the...

Consider a "market for pollution'' where the marginal abatement cost is given by ???(?)=300−2?MAC(e)=300−2e and the marginal social cost of emissions is constant at $20$20 per tonnes of emissions. ?e is measured in tons of emissions.

a) (4) What would be the unregulated market amount of emissions?

b) (4) What is the socially efficient amount of emissions?

c) (3) Compute the deadweight loss from the unregulated emissions externality.

d) (4) Give two policies, implied by this model, that can generate the socially efficient amount of emissions.

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