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Question: consider the market for bolts imagine that a hardware factory...

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Consider the market for bolts. Imagine that a hardware factory dumps toxic waste into a nearby river, creating a negative externality for those lving downstrcam from the factory. Producing an additlonal tonne of bolts imposes a constant extermal cost of $105 per tonne. The following graph shows the demand (private value) curve and the supply (private cost) curve for bolts Themarketecuiibringantys ▼ tes of bots. tutte soo hrotmal gathvcfbck production is ▼tomes. Use the purple points (diamond symboi) to plot the social cost curve when the external cost is $105 per tonne. create an incernive fif orne of hoks rdc h fl, the govemment could impose a of 630 Social Cost Supply Pivate Cost) 420 350 280 Demand Privatc Valuc) QUANTITY(Tonnes of boits)

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