Question: Hello. I would like some help to solve this question please. I have shown my work for part b on the left side. I do
Hello. I would like some help to solve this question please. I have shown my work for part b on the left side. I do not know if it is.

2. (32 points) Suppose there are two factories. In the course of their operation, they burn fossil b) fuels releasing greenhouse gases into the atmosphere. The cost of abatement for these two MAC1=200-0.1E factories is described by MAC1 - 200 - 0.1E, and MAC2 - 200 - 0.4E2 respectively, where MAC2-200-0.4 Ei for i - 1, 2 is tonnes of CO2 emission per month. The damages caused in the atmosphere To find the Socially Efficient standard for each firm: can be described by MD - 0.12E. MAC1=MD 200-0.1E=0.12E (a) Derive the aggregate marginal abatement cost function and find the socially efficient level of E=909.09= Fi emissions. (8 points) MAC2=MD (b) Assume that the regulator sets individual emission standards to control pollution. Find the 200-0.4E=0.12E socially efficient standard for each firm and calculate the total compliance cost per firm. (12 E=384.62=Ei points) Total compliance cost for MAC1 (c) Assume that the regulator sets an emission tax to control pollution. Find the level of the TCC1=TAC1 TAC= 12(bh=>(1090.91*109.09)= $59503.69 emission tax that is consistent with the socially efficient equilibrium and calculate the total compliance cost per firm. (12 points) Total compliance cost for MAC2 TCC2=TAC2 TAC=1/2(b*h)=1/2(115.38*46.15)=$2662.39
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