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a) Given the presence of this externality, what is the market equilibrium quantity & price and the socially optimum quantity & price? (2 points) b)

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a) Given the presence of this externality, what is the market equilibrium quantity & price and the socially optimum quantity & price? (2 points) b) Shade the region of the deadweight loss because of the negative externality. (Hint: You may have to do one extra step to get the area) (1 point) c) What is the amount of the external cost? (1 point) d) To x this, the government is going to put in a corrective tax. What should the amount of tax be in this case? (1 point) Companies producing toilet paper bleach the paper to make it white. The bleach is discharged into rivers and lakes and causes substantial environmental damage. The gure below illustrates the situation in the toilet paper market. Social Cost Private Cost 100 200 300 400 500 600 700 800 900 Quantity

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