Negative Externality The Following Questions Refer to the Accompanying Diagram, Which Shows

Multiple Choice

Negative Externality

The following questions refer to the accompanying diagram, which shows the effects of a negative externality created by an industry's production. The equilibrium quantity in the absence of any attempt to internalize the externality is QE, and the optimal quantity according to a Pigovian analysis is QO.

-Refer to Negative Externality.According to a Pigovian analysis of this externality,when a tax of $5 per unit is imposed on the firms in this industry,the external costs created by the firms' production will equal

A) area C + D + E + G + H.
B) area C + D + G + H.
C) area C + G.
D) zero.