Suppose the Demand Curve for Steel Is Q = 100

Multiple Choice

Suppose the demand curve for steel is Q = 100 - P, where P is the price per unit of steel and Q measures millions of units of steel. The private marginal cost of producing steel is MC = 5Q + 40, while the external marginal cost of producing steel is $12. In a perfectly competitive steel industry, the deadweight loss is:

A) $12 million.
B) $2 million.
C) $750,000.
D) $200,000.