Suppose there are several paper mills producing paper for a market. These mills, located upstream from a fishing village, discharge a large amount of wastewater into the river. The waste material affects the number of fish in the river and the use of the river for recreation and as a public water supply source. Figure 5-4 shows the paper market. Use this Figure to answer the following question(s).

Price of paper S1 P2 . . . .... A P1 B -.. . ... C . . . . . . . . . . . .. .... - . . . . . . . ..... D . .. . Demand 0 Q2 Q Quantity of paper Note: If the graph does not load automatically, click HERE Suppose there are several paper mills producing paper for a market. These mills, located upstream from a fishing village, discharge a large amount of wastewater into the river. The waste material affects the number of fish in the river and the use of the river for recreation and as a public water supply source. Figure 5-4 shows the paper market. Use this Figure to answer the following question(s). [Hint: Demand==> Marginal benefit; S1==>marginal private cost; S2==>marginal Refer to the Figure above. What is the economically (socially) efficient output level