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What is the equilibrium price paid by consumers and the

What is the equilibrium price and quantity of fertilizer in an unregulated, competitive mar- ket?

b) What is the efficient quantity of fertilizer?

c) Suppose government imposes a tax equal to the marginal external cost.

What is the equi- librium price paid by consumers and the equi- librium quantity after implementation of the tax?

d) At the output level in part

(c), how much is the tax?

e) How much tax revenue does government col- lect?

f) What is the deadweight loss borne by society if the externality is left uncorrected?

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