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Unformatted text preview: Update to Ch. 4 #7 We’ll change this problem slightly to make it more straight-forward. Instead of one of the goods being “rental payments” (which is actually a bad), change it to “money” (which is a good). In other words, let there be some initial endowment of money that Humphrey and Matilda split 50:50 (the actual amount isn’t important). Then when the two people bargain, just think of one of them paying the other in money, not in rental payments. Typo on Ch. 5 #5 In the last sentence of the main paragraph of the problem, it says, “the cheese factory saves 20p - 2p 2 .” This equation should be “20p - p 2 ”. Change to Ch. 5 #6 The following changes are intended to make the problem more direct and clear, without really changing the problem’s intentions. Instead of solving #6 in the book, you should solve the following problem: Consider the problem of carbon dioxide emissions. We will abstract away from the problem slightly, assuming there are polluters and consumers in two regions, the OECD (O) and the rest...
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This note was uploaded on 04/02/2010 for the course ECON Econ 115 taught by Professor Kolstad during the Spring '10 term at UCSB.
- Spring '10
- Environmental Economics