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(7, 8) thx The accopmanying graph depicts the marginal social cost (MSC) and the marginal social benefit (MSB) associated with pollution emissions. Assume the polluters

(7, 8) thx

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The accopmanying graph depicts the marginal social cost (MSC) and the marginal social benefit (MSB) associated with pollution emissions. Assume the polluters bear none 300 280 of the social cost of pollution and all of the benefits. Move 260 point P to the socially optimal level of pollution. Marginal social cost, marginal social benefit ($) 240 220 MSC What is the socially optimal amount of pollution? 200 CO 160 tons 140 120 What is the size of the tax that would move the market to this socially optimal quantity? MSB per ton 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Quantity of pollution emissions (tons)

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