A hedonic regression is run on the selling prices P of houses near an airport that sold within the last five years that results in the equation P =500000−400×N+0.75×income where P is the most recent selling price in current year dollars, N = 50/d, and d is the distance from the airport in miles. By current year dollars one means that the selling prices have been adjusted for inflation and the base year is the year of today’s date. 1. (a) What is the marginal willingness to pay on a per house basis for noise abatement when the benchmark is the noise level at 1 mile from the airport. 2. (b) What is the annualized marginal willingness to pay assuming an interest rate of 10%.