1. Suppose that all workers feel the same about working in a job that offers a polluted working environment. In particular, the utility function for all workers is given by:

U =(w) - 2x,

Where w is the wage rate offered by the job and x is the proportion of the firm's air that is composed of toxic pollutants. There are only two types of jobs in the economy, a clean job (x = 0) and a dirty job (x = 1). Let w₀be the wage paid by the clean job and w₁be the wage paid by the polluted job. If the clean job pays $16 per hour, what is the market compensating wage differential?