Final answer:
The increase in social well-being when the 59th unit of a good is consumed depends on the difference between the social value and social cost at that quantity. Externalities such as environmental pollution are considered to calculate true social costs and benefits, impacting market equilibrium prices and quantities.
Step-by-step explanation:
The student's question pertains to the concept of externalities in economics, more specifically to the calculation of social well-being when both private and social values and costs are considered. When the 59th unit of the good is consumed, the increase in social well-being would depend on the difference between the social value and the social cost at that quantity. Since it's mentioned that the private value and social value decrease by 1.00 and the private cost increases by 1.40 with each additional unit, we could calculate the increase in well-being if we knew the initial private and social values and costs or the specifics of how these values and costs change relative to the quantity.
The example provided where the new equilibrium occurs due to the added external costs of pollution which results in a higher price, lower production, and lower quantity of pollution correlates to the idea that when social costs are considered, the market outcomes adjust to reflect the full costs and benefits of production and consumption, leading generally to lower quantities being produced and consumed.