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Figure 17.11
-(Figure 17.11) The government wants to set the socially optimal level of nitrogen runoff, and government regulators believe that the actual marginal benefit of pollution (MBP) is given by the estimated MBP curve. The deadweight loss associated with a quota is _____, while the deadweight loss from a Pigouvian tax is _____.

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Use the following to answer question:
Figure 17.11 
-(Figure 17.11) The government wants to set the socially optimal level of nitrogen runoff, and government regulators believe that the actual marginal benefit of pollution (MBP) is given by the estimated MBP curve. The deadweight loss associated with a quota is _____, while the deadweight loss from a Pigouvian tax is _____.

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The deadweight loss associated with a quota is $2, while the deadweight loss from a Pigouvian tax is $18.

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