28) Based on the optimal choices of the Follower (from question 26) and the Incumbent (from question 27), evaluate the payoffs the Policymaker should expect depending on their regulatory choice. Hint: with demand Q(p) - 10 - p, a monopolist with marginal cost 4 would choose quantity am - 3, leading to price pm - 7. (a) The Policymaker's payoff is strictly higher with no environmental regulation. (b) The Policymaker's payoff is strictly higher with environmental regulation for new firms. (c) The Policymaker is indifferent between NR and RE. (d) It is impossible to know because the Incumbent is indifferent between at least two values of x, and thus the Policymaker cannot predict the Incumbent's behavior. (e) It is impossible to know because the Follower is indifferent between entering and not entering, and thus the Policymaker cannot predict the Follower's behavior