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A chemical factory and a fishing club share a lake. The marginal social costs, private marginal costs, and marginal benefits from producing chemicals are

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A chemical factory and a fishing club share a lake. The marginal social costs, private marginal costs, and marginal benefits from producing chemicals are in the figure .The chemicals dumped into the lake have always harmed the fish, but now they begin to damage the fishing boats as well. As a result, the marginal social cost curve shifts rightward. marginal social cost curve shifts leftward. marginal benefit curve shifts leftward. marginal benefit curve shifts rightward. Prce and costs (dollars per ton) 50 40 30 20 10 O 2 4 MSC MC=S D-MSB 6 8 10 12 Chemicals (tons per week)

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