(Solved): The following diagram represents the negative externality of plastic bags The diagram is labelled w ...

The following diagram represents the negative externality of plastic bags The diagram is labelled with letters \( A-D \). Indicate what each label represents by matching the numbered label with its correct letter. (4 mark) A B C D 1. The Pigouvian tax on the users of plastic bags 2. The estimated size of the social cost of plastic bags or the costs of pollution 3. The effect that the cost of the tax has on producers causing a fall in the supply or production of plastic bags 4. The effect of the tax on the price of plastic bags paid by consumers who now use less plastic bags.