Figure 159 Companies Producing Toilet Paper Bleach the Paper to to Make

Multiple Choice

Figure 15.9 Companies producing toilet paper bleach the paper to make it white.The bleach is discharged into rivers and lakes and causes substantial environmental damage.Figure 15.9 illustrates the situation in the toilet paper market.
-Refer to Figure 15.9.Suppose the government wants to use a Pigovian tax to bring about the efficient level of production.What should the value of the tax be?

A) (P₂- P₁) per ton of output
B) (P₂- P₀) per ton of output
C) (P₁- P₀) per ton of output
D) P₁ per ton of output