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MB Looking at the figure, it's clear that this market experiences a negative A (positiveegative) externality and results in overproduction A (overproduction/underproduction). This creates a
MB Looking at the figure, it's clear that this market experiences a negative A (positiveegative) externality and results in overproduction A (overproduction/underproduction). This creates a deadweight loss which is represented by the shaded region C A/ (use the format Letter+Letter in alphabetical order, ex: A+B+C). One possible solution for this externality is for the government to implement a Pigovian tax. What area would represent total economic surplus after implementation of the Pigovian tax? Ay (use the format Letter+Letter in alphabetical order, ex: D+E).P MC SC D E IN MB
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