I don't understand how to solve the following question. The answer is #8

Consider the production of paper in Strelsau. Suppose that the supply of paper is upwardsloping and the demand for paper is downwardsloping. The smell of the paperproduction process in this town is both strong and horrific. Suppose that the production of paper causes a negative externality of $1.50 per ream, and the conditions outlined by the Coase theorem do not hold.

By how much does the optimal price per ream of paper differ from the market price per ream ofpaper?

The optimal price is

1. is lower than the market price but by less than$1.50.
2. is exactly $1.50 higher than the marketprice.
3. cannot be determined with the information provided.
4. is exactly $1.50 lower than the marketprice.
5. is more than $1.50 higher than the marketprice.
6. equals the marketprice
7. is more than $1.50 lower than the marketprice.
8. is higher than the market price but by less than$1.50.