Use the Following to Answer Question

Multiple Choice

Use the following to answer question:
Figure 17.8
-(Figure 17.8) If the socially optimal quantity of the good is 200 pounds, there is a _____ externality, so the government should enact a _____ per pound to increase market efficiency.

A) negative; $6 tax
B) negative; $1 tax
C) positive; $6 subsidy
D) positive; $1 subsidy