An environmental economic consulting firm is hired to measure the negative externalities associated with the pollution from an industry. The marginal social cost production can be expressed as MSC = 2Q + 30. The consultants calculate the marginal private cost production to be MPC = Q+30. The market demand curve can be expressed as . If the consultants have accurately measured the impact of the pollution externality, the in social surplus from moving to the social optimum (rather than at the private optimum) is
A) $30
B) $37.5.
C) $55.
D) $67.5.
Correct Answer:
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