Consider two popular nightclubs in Pawnee, called the Snakehole Lounge and the Bulge. Unfortunately, both clubs cause no

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Consider two popular nightclubs in Pawnee, called the SnakeholeLounge and the Bulge. Unfortunately, both clubs cause noisepollution. Fortunately, there is a technology that the clubs canadopt to help reduce the noise pollution (sound absorbing panels).The cost of adopting this technology is different for each club.For the Snakehole Lounge, the marginal cost of reducing noisepollution is 10. On the other hand, for Bulge, this cost is 5. Inessence the marginal cost of noise reduction for both firms isconstant. Both nightclubs produce 15 units of noise pollution.Suppose that the social marginal benefit of noise reduction isdescribed by the following linear function 30 − (zS + zB) where zSand zB are the total reduction of the Snakehole Lounge and theBulge respectively.
a. Please use the model of pollution reduction to draw a graphindicating the social marginal benefit, the social marginal cost,and the private marginal benefit of noise reduction for thenightclubs. [5 points]
b. What is the socially optimal amount of reduction for theSnakehole Lounge and the Bulge? [5 points]