Rreq is the amount of required reductions for Sweden,
but the MACS curve already intersects the market price of CO2 allowances before Rreq has been reached.
Rreq is the amount of required reductions for Germany,
but at Rreq the MACG curve has not intersected the market allowance price of CO2(market allowance price = P = λ).
Suppose Germany can abate its CO2 at a much cheaper cost than Sweden, i.e. MACS > MACG where the MAC curve of Sweden is steeper(higher slope)
than that of Germany, and Rreq is the total amount of emissions that need to
be reduced by a country.
For this example let us assume that Germany can abate its CO2 at a much cheaper cost than Sweden, i.e. MACS > MACG where the MAC curve of Sweden is steeper(higher slope)
than that of Germany, and Rreq is the total amount of emissions that need
to be reduced by a country.
For this example let us assume that Germany can abate its CO2 at a much cheaper cost than Sweden, e.g. MACS > MACG where the MAC curve of Sweden is steeper(higher slope)
than that of Germany, and Rreq is the total amount of emissions that need
to be reduced by a country.
Example MACs for two different countries For this example let us assume that Germany can abate its CO2 at a much cheaper cost than Sweden, e.g. MACS > MACG where the MAC
curve of Sweden is steeper(higher slope) than that of Germany, and Rreq is the total amount of emissions that need
to be reduced by a country.