Parts a and b

Question 4) [1|] points] Suppose the government is considering a policy' to cut Nitrogen Oxide levels in an urban area Current NO}: levels are, on average, 50 parts per billion {pph}. There are 1 million residents in the area The government estimated a hedonic price function for houses in the area, and has developed the following numbers, Reduction (pph) WTP TAC($H1) MAC($II1) 1 2 -m nm-n -- The rst column shows the reduction from current concentration levels in pph. The second column shows the marginal willingness to payr per person. The third column shows the tolnl willingness to pay,r per person for that level of reduction. The fourth column shows that total abatement costs in millions of dollars for the rm and consumers in the area to reduce emissions enough to achieve the lower concentrations, and the fth column shows the marginal abatement costs:1 in millions of dollars. a) [5] How much of a reduction of NO): levels would you recommend based on these numbers? b) [4] Based on part a] what is the average ND): level in the area {in pph}