5. Assume as before that we have a perfectly competitive market for cigarettes, where the marginal cost of producing a pack of cigarettes is $4 (this marginal cost is constant and does not change based on quantity produced). Also, assume that each pack of cigarettes incurs a cost of $2 to the smoker's neighbors in the form of secondhand smoke. Now consider the case in which consumers can buy any (continuous) number of cigarette packs, including partial packs, each week. The market demand curve is represented by QD = 10-0.5*PD, which reflects private benefits and costs. (18 points) a. What is the equilibrium price and quantity? (4 points) HPA 460 Spring 2022 Problem Set 3 4 b. What is the socially efficient equilibrium price and quantity, including any externalities? (5 points) c. What is the Pigouvian tax on each pack of cigarettes to achieve the socially efficient equilibrium quantity? (5 points) d. What is the total tax revenue from this tax? (4 points)