Now draw a cap and trade model where firm A has a technology where y=x and firm B has a technology where y=2x. The funct
Posted: Thu May 19, 2022 11:05 am
Now draw a cap and trade model where firm A has a technology
where y=x and firm B has a technology where y=2x. The functions are
the firms’ marginal cost of abatement curves. The initial split of
permits is 80:20 in favour of firm A. The level of optimal
abatement is 150 gigatonnes. Draw the cap and trade model for these
two firms and show the outcome after trading. Label all relevant
quantities. (8)
where y=x and firm B has a technology where y=2x. The functions are
the firms’ marginal cost of abatement curves. The initial split of
permits is 80:20 in favour of firm A. The level of optimal
abatement is 150 gigatonnes. Draw the cap and trade model for these
two firms and show the outcome after trading. Label all relevant
quantities. (8)