The Figure Below Shows the Demand, Supply and Marginal Social

Multiple Choice

The figure below shows the demand, supply and marginal social cost curves for a steel plant.

-Refer to the scenario above. If the government imposes a tax of_____ , output will_____ .

A) $1; fall below the socially optimal level
B) $2; rise above the socially optimal level
C) $10; fall below the socially optimal level
D) $10; rise above the competitive level