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7- An industry has two production lines. Production line 1 produces 120 units of emissions per year and production line 2 produces 60 units of
7- An industry has two production lines. Production line 1 produces 120 units of emissions per year and production line 2 produces 60 units of the same emissions. Each production line Marginal Abatement Cost (MAC) function (\$ per unit of emissions) is given by: MAC1=120E1MAC2=1202E2 The marginal damage (MD) function is given by: MD=(4/3)ET Where :ET=E1+E2 Determine: i. The aggregate marginal abatement function of the industry. ii. The socially optimum level of emissions and its associated marginal damage (MD)
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