Consider a pollution problem with two sources and two recipient regions Abatement cost functions are given by C j (e j ) (a j b j e j ) 2 2b j for j 1,2 The diffusion matrix is given by and the damage function for receptor m is D m (A m ) d m A 2 m 2 (a) Determine how many permits must be issued for each region (b) Consider the special case where h 12 h 22 0 and interpret H (M M2) h1 M

Question: Consider a pollution problem with two sources and two recipient regions. Abatement cost functions are given by C j (e j )=(a j b j

Consider a pollution problem with two sources and two recipient regions. Abatement cost functions are given by C_j(e_j)=(a_j−b_je_j)²/2b_j for j=1,2. The diffusion matrix is given by:

H = (M M2) h1 M

and the damage function for receptor m is D_m (A_m)=d_mA²_m/2.

(a) Determine how many permits must be issued for each region.

(b) Consider the special case where h₁₂=h₂₂=0 and interpret.

H = (M M2) h1 M

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