Environmental Regulation Simulation
Decision Sheet
(1)
(2)
(3)
(4)
(5)
(6)
~~~~ Industry (Total) ~~~~
Round
Output
Emissions
Abatement Cost
Per Unit Tax
Per Unit Subsidy
Profit
Emissions
Profit
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Notes:
Abatement Cost = Card #
Revenue = $12 × (1)
Profit = Revenue - Regulatory Cost
Regulatory Cost:
Emissions Standard = (3) × [(1) - (2)]
Emissions Tax = {[(3) × (1) - (2)] + [(4) × (2)]}
Emissions Subsidy = [(5) - (3)] × [(1) - (2)]