consider the market for fire extinguishers.
a. why might fire extinguishers exhibit positive externalities?
b. draw a graph of the market for fire extinguishers, labeling the demand cruve, the social-value curve, the supply curve, and the social cost curve.
c. indicate the market equilibrium level of the output. give and ointuitive explanation for why these quantities differ.
d. if the external benefit is $10 per extinguisher, describe a govt. policy that would yield the efficient outcome.