Suppose that there are two firms, as per the following table: $40 09$ Initial Pollution Level. Let's assume that neither firm would actually increase its pollution. What would be the overall cost of achieving the desired 50 unit decrease in pollution? (Ignore the costs of the permits, just consider the costs of reducing pollution.) The dog that he puts outside each night barks all night. Coase says that there is no need for government involvement if transaction costs are sufficiently low, since the neighbors could negotiate a price for keeping the dog inside, if that were efficient. That is, make up two numbers, write them down, and provide a one-sentence explanation of why this results in the dog being incarcerated. 2 Firm e q How many?
