B. * Consider the same set-up as in part B of exercise 21.9. In the previous case

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B. * Consider the same set-up as in part B of exercise 21.9. In the previous case where we derived the market equilibrium, we said that in a model with many firms it was reasonable to model each individual firm as not taking its own impact of pollution into account and to simply model the cost function as c1x2 5 bx 2 1 dNx (where the latter entered as a fixed cost).

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