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5. Suppose that, for a particular kind of pollutant, it is known that the marginal damage function is given by MD = 150 + E
5. Suppose that, for a particular kind of pollutant, it is known that the marginal damage function is given by MD = 150 + E and the marginal abatement cost function is given by MAC = 50 E, where E represents aggregate emissions per month of the pollutant. a) Construct a graph illustrating these assumptions and find the level of emissions per month (both nmumerically and on your graph) where MAC = MD. (4) b) Would society be better off by undertaking a greater amount of abatement in order to reduce the level of emissions per month below this level? Clearly explain why or why not. (3)
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