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Problem 4 Suppose that the government sets an emission fee of $8000.pdf

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Problem 4: Suppose that the government sets an emission fee of $8000/ ton. a. Calculate the total abatement costs (TAC) for Firm 1 and Firm 2 at each level of emissions. Add to the table. b. Calculate total costs ( TC=TAC+ Tax payments) for Firm 1 and Firm 2 at each level of emissions. Add to the table. c. What will be the emission level chosen by Firm 1? By Firm 2? Explain..

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Problem 4: Suppose that the government sets an emission fee of $8000/ ton. a. Calculate the total abatement costs (TAC) for Firm 1 and Firm 2 at each level of emissions. Add to the table. b. Calculate total costs ( TC=TAC+ Tax payments) for Firm 1 and Firm 2 at each level of emissions. Add to the table. c. What will be the emission level chosen by Firm 1? By Firm 2? Explain.

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