Suppose an electric utility company expects to earn $1 million in profit each year.In the process of producing electricity,pollutants emitted by the firm's smokestacks impose costs of $50 per year on each of 10,000 neighboring residents.A smokestack scrubber that would eliminate 80% of the damage can be purchased for $200,000,but needs to be replaced each year.
a)Should the utility remain in business? Explain.
b)What is the least costly method of achieving an efficient outcome with respect to pollution?
c)If the right to the air (to remain clean)is assigned to the adjacent homeowners,what obstacles are likely to deter an efficient solution?
d)If the right to the air (to pollute it)is assigned to the utility company,what obstacles are likely to deter an efficient solution? Be specific.

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The Answer of Suppose an electric utility company expects to earn $1 million in profit each year.In the process of producing electricity,pollutants emitted by the firm's smokestacks impose costs of $50 per year on each of 10,000 neighboring residents.A smokestack scrubber that would eliminate 80% of the damage can be purchased for $200,000,but needs to be replaced each year.
a)Should the utility remain in business? Explain.
b)What is the least costly method of achieving an efficient outcome with respect to pollution?
c)If the right to the air (to remain clean)is assigned to the adjacent homeowners,what obstacles are likely to deter an efficient solution?
d)If the right to the air (to pollute it)is assigned to the utility company,what obstacles are likely to deter an efficient solution? Be specific.

Suppose an Electric Utility Company Expects to Earn $1 Million