(Table: The Marginal Social Benefit of Computer Chips)Use Table: The Marginal Social Benefit of Computer Chips.The production of computer chips generates an external benefit in the form of a technology spillover.If the marginal social benefit is indicated by MSB,the optimal Pigouvian subsidy is equal to $10.

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The question states that the optimal Pigouvian subsidy is equal to $10, meaning that the government should provide a subsidy in order to incentivize the production of computer chips that accounts for the positive externality of technology spillovers. This is consistent with the marginal social benefit being greater than the marginal private benefit, as shown in the table.

(Table: the Marginal Social Benefit of Computer Chips)Use Table: the Marginal