Suppose a paper mill emits noxious odors that represent a negative ext

Suppose a paper mill emits noxious odors that represent a negative externality for people living near the plant.

If the plant managers ignore these external effects on their neighbors, what is the efficiency character of the resulting market outcome? A) The plant generates too much paper due to incomplete information.
B) The plant generates too much paper because the odors are nonexclusive.
C) The plant generates too much paper because the managers ignore the external costs of the air pollution on the neighbors.
D) The market outcome is efficient.

ANSWER

C