Question: If = 100, = 200, MAC = 2a1, MAC = /2a2, and 25 permits are initially distributed free of charge to each polluter in

If = 100, = 200, MAC = 2a1, MAC = /2a2, and

If = 100, = 200, MAC = 2a1, MAC = /2a2, and 25 permits are initially distributed free of charge to each polluter in a system of TDP's, which polluter will buy from which? What will be the ending distribution of permits after trading occurs? What will be the resulting allocation of abatement responsibility?

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