(d) Suppose that good X is produced in a perfectly competitive industry. Answer each of the following. (i) Using labeling from the graph, identify equilibrium output in the absence of regulation. Explain how you determined your answer. (ii) To produce the socially optimum output, indicate whether the government should tax or subsidize the firms in the industry. (iii) Calculate the dollar value of the needed per-unit tax or subsidy. PRICE (S) 12 Marginal Social Cost 7 Marginal Private Cost 4 Demand = Marginal Social Benefit Q Q 2 Qa QUANTITY OF GOOD X Marginal Revenue