(a)-What are the conditions that allow the equivalence between the cap and trade and the pollution tax approaches to ensuring the industry produces the efficient level of output? (b)[n practice, these energy policy approaches raise a number of issues and a recurring debate among environmental policy makers about their relative merits. While a carbon tax has been implemented in some countries in Europe, debates and discussions in the US have prevented its implementation. In one of the 2008 Presidential Primary debates, one candidate advocated the cap-and-trade system over a carbon tax on the grounds that the carbon tax would be partially passed onto consumers in the form of higher prices. Another candidate who also supported the cap-and-trade system corrected this assertion suggesting that, to whatever extent a carbon tax would he passed onto consumers, the same is true costs (of tradable permits) under the cap-and trade system. Using theory of tax incidence, illustrate the relative merits of each argument. (c)-Fu1ther arguments were raised around the same time period by inuential economists such as Greg Mankiw who summarizes them in this paper (attached to the assignment): \"Smart Taxes, an open invitation to join the Pigou club\