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I need help plotting the social cost curve when the external cost is $40 per ton and answering Consider the market for bolts. Suppose that

I need help plotting the social cost curve when the external cost is $40 per ton and answering

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Consider the market for bolts. Suppose that a hardware factory dumps toxic waste into a nearby river, creating a negative externality for those living downstream from the factory. Producing an additional ton of bolts imposes a constant external cost of $40 per ton. The following graph shows the demand (private value) curve and the supply (private cost) curve for bolts. Use the purple points (diamond symbol) to plot the social cost curve when the external cost is $40 per ton. 200 180 Social Cost 160 O 140 O 120 O Supply (Private Cost) 100 PRICE (Dollars per ton of bolts) 80 O Demand 80 (Private Value) 40 20 QUANTITY (Tons of bolts) The market equilibrium quantity is tons of bolts, but the socially optimal quantity of bolt production is tons. To create an incentive for the firm to produce the socially optimal quantity of bolts, the government could impose a of $ per ton of bolts

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