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The Demand Curve and Supply Curve for a Good Are

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The demand curve and supply curve for a good are given by QD = 100 - 5P and QS = 1.25P - 2.5. Suppose the production of this good creates a negative externality, where the external marginal cost is constant at $2. The demand curve and supply curve for a good are given by Q<sup>D</sup> = 100 - 5P and Q<sup>S</sup> = 1.25P - 2.5. Suppose the production of this good creates a negative externality, where the external marginal cost is constant at $2.

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