Cap and dividend (adapted from Boyce and Riddle) Aggregate US demand for carbon emissions (or the marginal benefit of carbon emissions) is approximately: Q = 1,500,000,000 Solution 3. If the total cost is $ 400 then Q is: = 1,500,000,000 - 500,000 ($400) = 1,300,000,000 4. The corbon permits should give by the government is : = 1,300,000,000/ $200= 6,500,000 5. If the government collects taxes, it can be utilize for the welfare or development of the citizens of US 6. the amount is going to be distribute equal to all to the people of US 7. The tax impose on rich should be high with proportinate of their emit of carbon gases, and if the government distribute on the basis of equal per capita income the rich will be the beneficiaries and poor will be the sufferers. .