Suppose the Market for Oranges Is Perfectly Competitive and Unregulated

Multiple Choice

Suppose the market for oranges is perfectly competitive and unregulated.Suppose also that the chemicals used to keep the oranges insect-free damage the environment by an estimated $1 per bushel of oranges.Suppose Q_D = 1000 - 100P and Q_S = -100 + 100P.The "optimal" amount of environmental damage would be

A) $0
B) $400
C) $450
D) $500