Question: Hello, I would like some help to solve this question please! 1. [30 points] Three people live around a coal-red power plant. Each individual has

Hello, I would like some help to solve this question please!

Hello, I would like some help to solve this question please! 1.

1. [30 points] Three people live around a coal-red power plant. Each individual has a different sensitivity to air pollution, therefore, each has a different willingness-to-pay for clean air. The following equations describe their willingness-to-pay [WTF], where Q is the level of clean air. a = Ion0.5m Us we The marginal cost of cleaning up the air is given by, M0 = 0.5!? + 140 (a) Derive graphically and algebraically the aggregate demand function for clean air and nd the socially e'icient level of clean air. (b) Calculate each individual 's total benet, the total cost and the total net benet at the socially efcient level of clean air. (c) If individual C decide-3 to free ride and contribute zero, derive graphically and algebraically the aggregate demand function. What is the socially e'icient level of clean air? 1Wl'iat do you observe? (d) Assume now that no one free-rides, however, due to a technological progress the marginal cost of cleaning up the air becomes MC = [LEG +1010. Find the socially efficient level of clean air. How much is each individual willing to pay for the socially efcient level of clean air

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