What is the market equilibrium? What is the market price? What is the optimal quantity? What should the government do in order to ensure the market produces optimal quantity? How big should the government's corrective taxes or subsidies be in this case? As a result of the positive externality, this Market over produces, produces the optimal amount, or under produces?

Page 2 Suppose that there is a positive externality in the market for pizza rolls. The graph below shows the supply and demand curves for pizza rolls. 14* 13- DS (MSB) 12+ 10% 84 market Price of pizza rolls MP.C) 4 5 6 7 8 9 10 11 12 13 14 "Quantity of pizza rolls 4. What is the market equilibrium? What is the market price? hp f4 f6 0 + tg 144 $ & XK