Question: need help with this please Problem 4 A chemical factory is situated next to a farm. Airborne emissions from the chemical factory damage crops on
Problem 4 A chemical factory is situated next to a farm. Airborne emissions from the chemical factory damage crops on the farm. The marginal benefits of emissions to the factory and the marginal costs of damage to the farm are summarized in the table below: a. What level of emissions would the chemical factory produce if it could ignore the effects of its pollution on farmers? Why? (5 points) b. What level of chemical emissions would the farmer prefer? Why? ( 5 points) c. From a welfare economic perspective (which is what we have been doing in class), what is the socially optimal level of emissions? Why? (5 points) d. How would Pigou solve this environmental conflict of interest? Be specific, providing numeric values where appropriate. ( 5 points) e. How would Coase solve this environmental conflict of interest? Be complete in providing all the interventions that Coase might suggest. ( 5 points)
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