Use the following to answer questions: Figure: Marginal Private Benefits and Marginal Social Benefits -(Figure: Marginal Private Benefits and Marginal Social Benefits) Look at the figure Marginal Private Benefits and Marginal Social Benefits. One way for the government to achieve this socially optimal level is by: A) imposing a per-unit tax equal to P₁ - P_2. B) providing a per-unit subsidy of P₀ - P_2. C) mandating consumption at output level Q_1. D) leaving the quantity at the initial private market-clearing quantity and price.

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Providing a per-unit subsidy of P₀ - P₂ would encourage consumption to reach the socially optimal level by aligning private benefits with social benefits.

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