In an effort to preserve the elephants, the government has decided to ban the ivory trade and outlaw the killing of elephants. What do you think would be the likely outcome of this solution? What might be a more effective alternative to saving these elephants? Q4. (12 points) Suppose two firms, All-American Power (Firm A) and Big Energy Inc. (Firm B) have the following marginal abatement cost curves: MACA = 300 - 3eA and MACB = 200 - 2eB, and the government wants to use an effluent tax to keep total emissions down to 50.

A. (6 points) Draw a graph of each firm side by side, clearly marking the intercepts of their respective MAC curves. Calculate the optimal number of emissions for each firm given the efficiency and abatement constraints as well as the optimal tax rate necessary to get to those level of emissions.