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The market equilibrium quantity is5 tons of steel, but the socially optimal quantity of steel production is 3.5 tons. To create an incentive for the
The market equilibrium quantity is5 tons of steel, but the socially optimal quantity of steel production is 3.5 tons. To create an incentive for the firm to produce the socially optimal quantity of steel, the government could impose a tax or subsidy of $150 per ton of steel
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