4. (5 Marks) Suppose there are two major Nuclear Energy Markets, U.S.A and Russia. The following are their MB function for reducing carbon: MBUSA = 650 - 5QUSA MB Russia = 400 - 3. 33Q Russia MC = 100 for both markets a. Derive the aggregate demand function. b. What is the efficient reduction in carbon? Show all your work.5. (4 Marks) Suppose OPEC is planning to introduce a new set of techniques to extract oil and reserve them. The following table is an estimated cash flows of the project: Year Cash flows ($) 0 -400,000 120,000 2 130,000 3 140,000 4 150,000 Define NPV = PVo + PV1 + PV2 + PV3 + PV4. OPEC will only pursue with the project if NPV > 0. Calculate the NPV of the project assuming 8% discount rate compounded annually. 6. (10 Marks) Suppose market demand for oil is Q(P) = 100 - 0.75P where Q is billions of barrels (BBL) or oil per year and P is price per barrel where, MC(Q) = 702 -30 + 6 There is a total of 100 BBL of oil available to use in periods 0 (current year) and 1 (next year). Assume the interest rate is 5%. What is the revenue-maximizing quantities of oil to extract in each period? What are the corresponding prices? What is the CS, PS, SW in each period? Show that this solution maximizes social welfare