The diagram presents the marginal private benefit (MPB), the marginal private cost (MPC) and the marginal social cost (MSC) for a firm that makes chemicals. Under a free market, the price is set at P1. Which quantity shows the extent of chemical overproduction caused by the negative production externality?
- AQ1,Q2
- BQ1,Q3
- CQ2,Q3
- DQ3,Q4