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Pls help me with these questions. Tok Aba has a factory producing chocolates located at the upper stream of Bamboo River. At the lower stream

Pls help me with these questions.

Tok Aba has a factory producing chocolates located at the upper stream of Bamboo River. At the lower stream of the river, Adudu owns a freshwater fish farm. Tok Aba's chocolate factory pollutes the river and affects Adudu's fish production. It is a choice for Tok Aba whether to install a filter and for Adudu whether to install a treatment plant. Table 1 shows the profit of Tok Aba and Adudu in different situations.

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Table 1: Profit of Tok Aba and Adudu / Situation Tok Aba (RM) Adudu (RM) 10,000 2,000 No filter or treatment plant 6,000 10,000 Filter; no treatment plant 10,000 4,000 No filter, treatment plant 6,000 6,000 Filter; treatment plant a) What should Adudu do if he knows that Tok Aba will maximize his profits and no negotiation is possible? Will this option be socially optimal? Why yes/why not? (4 markah/marks) b) Inde mer aka teThe pasang? yang a yang embayal If Tok Aba has the legal right to use the river in the way that he likes and there is no cost of negotiation, what will be the outcome? In other words, will the filter or/and the treatment plant be installed? If there is any compensation paid, what is the acceptable amount of such transfer and who will make the payment? (8 markah/marks)c) If Adudu has the legal right to have clean water and there is no cost of negotiation, what will be the outcome? In other words, will the filter or/and the treatment plant be installed? If there is any compensation paid, what is the acceptable amount of such transfer and who will make the payment? (8 markah/marks) d) Now suppose the body of water lies on an international boundary, and Adudu speaks a different language than Tok Aba. To negotiate, they will need a translator who can be hired at the cost of RM2500. What will be the outcome in this situation if the legal right to use the river is owned by Tok Aba?e) Discuss the Coase theorem based on your answers in (a) - (d). (3 markah/marks)

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