1. Assume that the production of a good in a perfectly competitive market results in a negative externality. Draw a correctly labeled graph of the market for the good and show each of the following.

1. The marginal private cost (labeled MPC) and marginal social cost (labeled MSC) of the good

1. Label the quantity produced by the market Q_m

1. Label the socially optimal level output Q_s

1. Show the area of deadweight loss