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In order to reach the social optimum, an economist would recommend (circle one): Producing the quantity of paper that would eliminate the negative externality Producing

  1. In order to reach the social optimum, an economist would recommend (circle one):
    1. Producing the quantity of paper that would eliminate the negative externality
    2. Producing the quantity of paper that sets marginal social cost equal to marginal benefit.
    3. Producing the quantity of gasoline that sets marginal private cost equal to marginal benefit.
    4. Producing the free market quantity of gasoline.
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