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Figure: MSB and MSC of Pollution
-(Figure: MSB and MSC of Pollution) Use Figure: MSB and MSC of Pollution.Assume that firms are the only beneficiaries of pollution and that costs are borne solely by others in the society.What level of pollution represents the socially optimal level?

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Use the following to answer question:
Figure: MSB and MSC of Pollution

-(Figure: MSB and MSC of Pollution) Use Figure: MSB and MSC of Pollution.Assume that firms are the only beneficiaries of pollution and that costs are borne solely by others in the society.What level of pollution represents the socially optimal level?

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The socially optimal level of pollution is where the marginal social benefit (MSB) of pollution equals the marginal social cost (MSC) of pollution. This point ensures that the benefits derived from pollution by firms are exactly balanced by the costs imposed on society, leading to an efficient allocation of resources.

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