The graph illustrates the unregulated market for pesticide. Price (dollars per t

Question

The graph illustrates the unregulated market for pesticide. Price (dollars per ton) When the factories produce pesticide, they also create waste, which they dump into a lake on the outskirts of town. The marginal external cost of the dumped waste is equal to the marginal private cost of producing pesticide (that is, the marginal social cost of producing the pesticide is double the marginal private cost.) If no one owns the lake, the quantity of pesticide produced is tons a week 120 The efficient quantity of pesticide is tons a week. 20 Quantity (tons of pesticide per week) 40 60 80 100

Explanation / Answer

1)120 tonnes , as the no one's own the lake so company can dump that without Any cost so they just saved the same amount they used to produce what as we have 60 tones.

2) 60 tonnes thia the efficient where both the curve intersect each other .

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