1. Suppose that a firm can increase its profits by $1 million each year by choosing not to comply with environmental regulations. The firm is a riskneutral expected profit maximizer. The probability that the firm will be detected and found to be out of compliance is 40 percent, and the probability that a judge will impose a penalty given detection is 75 percent. If the only penalty is a fine, what is the minimum fine necessary to get this firm to comply with environmental regulations?