EXTERNALITIES: PIGOUVIAN TAX Each car traveling from Boulder to Denver increases the congestion on the highway. From the perspective of the driver, the car trip is a private good - only he/she benefits from the trip. If the total number of trips taken by all drivers is Q (trips per minute), the Social Marginal Benefit ("willingness to pay") of an additional trip is: SMB = 10 - 0.1Q ($ per trip). A car trip uses up gasoline, for which the marginal resource cost is 1 ($ per trip). The social marginal benefit and the marginal resource cost are drawn on the attached curve sheet. In addition to the resource cost of the trip, there is an external cost caused by the extra congestion. When an additional trip is taken, the additional trip slows down all the pre-existing travelers: the cost imposed on each pre-existing traveler is 0.05 ($) and so the total external marginal cost imposed on all pre-existing travelers is: EMC = 0.05Q ($ per trip). The social marginal cost of an additional trip is the resource cost plus the external cost: SMC = 1 + 0.05Q ($ per trip). a) What is the efficient number of car trips ?b) With laissez-faire (no government program), the road is untolled and the market for gasoline is competitive. How many car trips are made ? c) What road toll or Pigou Tax ($ per trip) would cause the efficient amount of car trips to be undertaken? d) How much does society gain in net benefit as a consequence of the untolled road changing to a tolled road with the toll set at the level of Part (3) ?