Suppose that the production of steel unavoidably causes pollution. The damage done by the pollution is estimated to have a cost of €20 for each ton of steel produced.

a. What is a second name for the supply curve here?
b. In the graph above, one (and only one) of the dotted lines represents a social cost curve. In a single sentence, explain how you know which curve it is.
c. What are the equilibrium price and quantity of steel? Explain how you find this answer.
d. What are the efficient or optimal price and quantity of steel? Explain how you find this answer.
e. An area in the graph represents welfare loss for the equilibrium outcome. Is this area above or below the demand curve?