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The famous singer Jason Lumberpond likes to drive his solid-gold rocket car back and forth in front of his house. The loud noise from the rocket engines imposes a loss equal to $L on his neighbors. There are two possible ways to avoid that loss. Jason can install an expensive muffler, or the neighbors can install soundproofing on their houses. The muffler costs $C and the soundproofing costs $E. Suppose that L > E > C. What outcome maximizes total surplus?
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