Question 1 (10 marks)

John Clkxt is an advocate of environmental protection and only uses environmentally friendly products in his production process. As a result, Clkxt has seen a rise in the number of customers and is now making record profits, to the envy of many of his competitors. Despite this, Clkxt is threatening to leave the industry if government does not subsidize his production. Many residents, including some of Clkxt's customers, are concerned about the tax implication of a subsidy program and oppose the idea. How do you think each side would present their case on the grounds of allocative efficiency? Explain in point form.

Allocative Efficiency:

• Clkxt's subsidy justified

• Those opposed to Clkxt's subsidy

Question 2 (10 marks)

A recent contract between two Canadian residents (A and B) specified that B would be the feature performer at a music concert A was promoting in Spain. Since B's skills are unique, promoters are in in constant demand for her services. One week before the concert, B informed A that she would be unable to perform due to a recent offer she could not refuse (meaning the reward was substantially more than A's) ...

At this point, B is appealing a lower court ruling that allows A to recover expenses related to the concert, before and after the contract between the two was terminated. In essence, B is challenging the scope of the expenses. What are the economic challenges for judges ruling in this case and cases of a similar nature? Please explain, using contracts, efficiency and social welfare as the basis for your position. Use point form

Question 3 (10 marks)

Answer the following question using concepts we discussed in Property/Contracts/Torts in CECN321 this term.

Assume a well know university only plans to hold on campus classes. What might be the legal and economic justification for a university asking all professors to be vaccinated in order to attend courses on Campus as a result of the COVID-19 Pandemic and the State does not force the university to compensate any professor who would not have chosen to get a vaccine but did so because of the directive? Use point form.

Question 4 (10 marks)

A national car racing promoter in the city of Oistens is staging car racing because car racing is becoming popular and profit from the operation are expected to be high. Furthermore, car racing will be great for tourism and jobs in the industry. However, residents of Oistens and the surrounding area have commenced a legal challenge because the noise from the cars is intolerable and they want the racing to end. Assess the validity and resolution to the complaint from the perspectives of Pigou and Coase. Use point form.

Your points should then allow you to write a conclusive statement about whose position is best and on what grounds.