Figure 5 Price Supply (Private cost) Social Value Demand (Private Value Q1 Q2 Q3 Q4 Quantity 4. Refer to Figure 5. Which quantity represents the social optimum for this market? a. Q1 b. Q2 C. Q3 d. Q4 100 8 moo 5. Refer to Figure 5. To internalize the externality in this market, what should the de no government do? a. produce the product itself b. impose a tax on this product c. provide an investment credit d. provide a subsidy for this product 6. It is difficult to prevent people from using public goods once they are produced. What is this called? a. adverse selection b. the free-rider problem c. asymmetric information d. the tragedy of the commons Page 4 of 20