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End of Chapter 3.10 Question He Companies that produce toilet paper bleach the paper to make it white. Some paper plants discharge the bleach into rivers and lakes, causing substantial environmental damage. S, = marginal social cost S, = Suppose the graph illustrates the situation in the toilet paper market. marginal private cost By imposing a tax on toilet paper, the government will cause 150 A. consumers to internalize the externality causing the equilibrium price of toilet paper consumed to stay the same. 125 Price per ton of toller paper (dollars) B. consumers to internalize the externality causing the equilibrium price of 100 toilet paper consumed to decrease. C. consumers to internalize the externality causing the equilibrium quantity of toilet paper consumed to decrease. D. consumers to internalize the externality causing the equilibrium quantity of toilet paper consumed to increase. D :350 :450 The value of the tax should be $ per tousand ton of toilet paper. Quantity (1,000 tons of toilet paper produced per week)