Environmental Regulation Simulation
You will receive a government subsidy for each unit of emissions abated. You have two options:
You should choose the option that results in the maximization of profits.
A roll of the dice will determine the initial abatement subsidy. The per unit abatement subsidy is:
S = die + .5
For example, if the die roll is 6 the subsidy is 6.5. Trial and error will be used to determine the abatement subsidy that reduces emissions to the optimal amount.