ANSWER ALL PARTS PLEASE

1.) Draw a correctly labeled graph that shows, without government intervention PC and MSB.

a. Show where a market, without government intervention would determine its quantity

of noise pollution from an airport in a small town. Mark this quantity A.

b. Now assume government intervention and add the appropriate curve when

government levies a per unit tax. Mark this curve MSC.

c. show the new equilibrium that determines the socially optimal quantity of pollution.

Mark this quantity B.

d.. What can you say about MSC and MSB at the socially optimum level?