hand write and urgent

Suppose that the marginal control cost (MCC) functions of Fim A and Firm B as follows (ER= the amount of emission reduction): MCC function for Fimm A MCCA = ERA MCC function for Firm B MCCB --- ER3 Currently, both Firm A and B are emitting 20 units each. The government is attempting to reduce the emission to 20. (a) What is the optimal level of emission reduction for each firm? (b) If the government imposes an emission tax, how much should be the tax rate per unit emitted? (c) Explain by using a figure how the dynamic efficiency is achieved through an emission tax policy (d) Suppose that the government decided to adopt an emission trading mechanism. The initial allocation of emission permits is shown in the table below. Initial # of Permits Current Emission Firm A 10 20 Firm B 10 20 At the equilibrium, how many units of permits does Firm A hold? How about for Firm B? (e) Evaluate emission trading mechanism in term of the cost efficiency and the dynamic efficiency Suppose that the marginal control cost (MCC) functions of Fim A and Firm B as follows (ER= the amount of emission reduction): MCC function for Fimm A MCCA = ERA MCC function for Firm B MCCB --- ER3 Currently, both Firm A and B are emitting 20 units each. The government is attempting to reduce the emission to 20. (a) What is the optimal level of emission reduction for each firm? (b) If the government imposes an emission tax, how much should be the tax rate per unit emitted? (c) Explain by using a figure how the dynamic efficiency is achieved through an emission tax policy (d) Suppose that the government decided to adopt an emission trading mechanism. The initial allocation of emission permits is shown in the table below. Initial # of Permits Current Emission Firm A 10 20 Firm B 10 20 At the equilibrium, how many units of permits does Firm A hold? How about for Firm B? (e) Evaluate emission trading mechanism in term of the cost efficiency and the dynamic efficiency