What would be the market clearing price

Reference no: EM133663012

Assignment:

Now suppose that the regulator permits each firm to emit 15 units each (as in part a), but allows firms to trade these permits with each other. Are there gains from trade between these two firms? If these were transacted in a competitive permit market, what would be the market clearing price? (Please ignore the fact that, with only two firms, this market might not be so competitive).

Reference no: EM133663012

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