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The Market of Gasoline in the Sate of Maryland is described by the figure below: Market of Gasoline in the State of Maryland Price Social

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The Market of Gasoline in the Sate of Maryland is described by the figure below: Market of Gasoline in the State of Maryland Price Social Cost=So (Private Cost) + E $10T So (Private Cost) pc=$5.5 $5 Ps=$4.5 Do 0 90 100 Gasoline Million of Gallons The market equilibrium without market intervention is: 100 million of gallons per year at $5 per gallon. The government estimates that the cost of the externality per gallon of gasoline consumed is $1. The deadweight loss produced by this negative externality is equal to:

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