Illustrate what is total subsidy that firm receives

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Reference no: EM1371074

Q. A subsidy is set as $150.00/litter/year of phosphates emitted and Marginal Abatement cost curve of firm is Provided by P=500-4q where q is level of phosphates in litters/year and P is marginal cost of emissions. Assume that subsidy is for any amount of phosphates reduced from pre-subsidy level. Illustrate what is amount of phosphates that firm should emit? Illustrate what is total subsidy that firm receives at this optimal level of emissions? total abatement cost of firm at optimal level of emissions?

Reference no: EM1371074

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