7) The graph below is of a single source of pollution that operates under a transferable discharge permit policy. The market price of permits is p', which the firm takes as fixed. The firm is given (for free) either q° or q¹ permits initially. $ p MAC qº q¹ Emissio ns Permits a. What is the efficient level of emissions for a firm, given p* price of permits? Indicate it in the graph. [1 point] b. Use the graph to help explain why the initial allocation of permits does not affect how many permits the firm chooses to hold after trading is complete. [2 points]

8) The graph below is of aggregate marginal damage and aggregate marginal abatement costs associated with some pollutant. Suppose a regulator wishes to control emissions with a competitive transferable emissions permit policy. p* Aggregate Marginal Abatement Costs d C Q*=E* b a EU Aggregate Marginal Damage Aggregate Emissions a. Identify the efficient supply of emissions permits. What will be the price of permits if sources trade them competitively? [1 point] b. Identify the reduction in aggregate damage from the efficient policy. [1 point] c. Identify the aggregate abatement cost of the efficient policy. [1 point] d. Identify the aggregate value of all emission permits. Under what circumstances does this value accrue to the pollution sources? Under what circumstances does this value accrue to the

UMass ΜΑ CA 3) Below is the graph of the marginal abatement cost schedules of two firms, A and B. Suppose that the two firms face a uniform emissions standard Eº. Explain why this is not a cost-effective policy to control emissions. [2 points] ΜΑ CB RESEC 262 Summer ED Problem Emissions

UMass RESEC 262 Summer a 4) The firm in the graph below faces a tax for each unit of emissions that it releases. Marginal abatement cost b Emissions Problem a. Clearly mark in the graph the firm's choice of emissions when it faces the tax 7. [1 point] b. What is the: [3 points] i. total tax bill ii. total abatement costs, and iii. total compliance costs when it faces the tax 7.

3. Lucy and Melvin share an apartment. They spend part of their income on private goods such as food and clothing, which they consume separately, and part of their income on public goods such as the refrigerator, heating and rent, which they share. Lucy's utility function is 2XL+G and Melvin's utility function is XM6, where XL and XM are the sums of money spent on private goods for Lucy and Melvin, and G is the sum of money spent on public goods. Lucy and Melvin have a total of $8,000 a year to spend on private goods for each of them and on public goods. a. What is the absolute value of the marginal rate of substitution between private and public goods for Lucy? What is this value for Melvin? Write an equation to calculate the Pareto efficient quantity of public goods. b. Suppose Melvin and Lucy each spend $2,000 on private goods and the remaining $4,000 on public goods. Is this Pareto efficient? c. Give an example of another Pareto optimal outcome in which Melvin receives more than $2000 and Lucy receives less than $2000 for their consumption of private goods. Give an example of another Pareto optimum in which Lucy receives more than $2000./nd. The Pareto optima that makes Lucy better off and Melvin worse off will have (more, less, the same amount) of public goods than the Pareto optimum that treats them the same.

1. ASSESSMENT BRIEFING In this individual assignment you are required to choose a city and identify and research two key sustainability issues, which are negatively impacting your city's sustainability performance. You will apply sustainability concepts; analyse and raise awareness of these problems and their causes. You will communicate your research effectively and succinctly by designing and producing an aesthetically pleasing poster. A successful poster will not only attract the viewer's attention, for it will also outline accurately and concisely the purpose, findings, and conclusions of your research. Your poster will be designed to include a balance of text, images, figures, and tables. The poster should include in-text citations or references to your research sources. Your submission should include a reference list of recent academic and non-academic sources, presented in the Cite them Right Harvard Referencing style. You must choose one city from the Arcadis Sustainable City Index 2022 Your selection should be based on the availability of the information and data needed to complete the module assessments. Make sure you get advice from your seminar leaders as you work through your assignment. 1.1. Word count and Submission method • 700 words maximum (excluding main title, subheadings, figures / tables and reference list) • Your poster will be uploaded to Turnitin as a single PDF (file must be less/n1.1. Word count and Submission method • 700 words maximum (excluding main title, subheadings, figures / tables and reference list) • Your poster will be uploaded to Turnitin as a single PDF (file must be less than 100 MB) • Document Name: 5BUSS015W CW1 o Please DO NOT include your name or student number with in the file name or anywhere within your submission as marking is anonymous. 1.2. Assessment format and design: • Poster created in Power Point, Canva, Adobe Express, (click on 'Log in with school account' (use your UoW email address without 'MY'. Example: w1234567@westminster.ac.uk), MS Word or other software. • Reference list on a separate page. • Style: 2

UMass RESEC 262 Summer 1) The Clean Air Act requires the EPA to set these standards "requisite to protect the public health" with "an adequate margin of safety." This has been referred to as zero-risk standards. Use the graph below to answer the questions below concerning the economics of zero-risk ambient concentration standards. Aggregate marginal abatement costs A¹ A² A³ Aggregate marginal damage A4 Problem A5 Ambient concentration a. What is the maximum ambient concentration in the graph that would achieve the zero-risk goal? [1 point] b. Is a zero-risk ambient concentration standard likely to be efficient? Why? [2 point]

UMass RESEC 262 Summer Problem 6) In the graph below, marginal enforcement costs have been added to aggregate marginal abatement costs to indicate that enforcement costs are an additional cost of controlling emissions. Aggregate Marginal Abatement Coggregate Marginal Damage ($) Aggregate Marginal Abatement Cost plus Marginal Enforcement Costs Emissions EU a. In the graph identify the efficient emissions tax and the efficient level of emissions. [2 points] b. Explain why the efficient emissions tax is lower than the value that equates Aggregate Marginal Damage to Aggregate Marginal Abatement Cost plus Marginal Enforcement Costs. [2 points]

Write a critique of this statement: "Thank goodness we have so many government regulations and regulatory agencies! They keep Big Business in check." Your written critique can factor in both positive and negative points. Keep your statements apolitical and only aimed at the economic consequences. In 150 words