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Unformatted text preview: rental affect efficiency in this market? 5. Suppose the law says that Jones may not emit smoke from his factory unless he gets permission from Smith, who lives downwind. If the relevant costs and benefits of filtering the smoke from Joness production process are as shown in the following table, and if Jones and Smith can negotiate with one another at no cost, will Jones emit smoke? Jones emits smoke Jones does not emit smoke Surplus for Jones $200 $160 Surplus for Smith 400 420...
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- Spring '08