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A subsidy is set as $150.

A subsidy is set as $150.00/liter/year of phosphates emitted and the Marginal Abatement cost curve of the firm is given by P=500-4q where q is the level of phosphates in liters/yesr and P is the marginal cost of emissions. Assume that the subsidy is for any amount of phosphates reduced from the pre-subsidy level . What is the amount of phosphates that the firm should emit? What is the total subsidy that the firm receives at this optimal level of emissions? The total abatement cost of the firm at the optimal level of emissions?

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