Answer
Since the third party costs of dirty water is much less than the third party cost of cyanide poison, the deviation between the marginal private benefit and the marginal social benefit curves would be much greater in the case of poison. As can be seen from the diagram, the socially optimum quantity of poison that should be consumed is close to zero, which would mean the optimum abatement rate would be close to 100% in poison's case. However, in the case of dirty water, the negative third party effects are low to the extent that the optimum quantity is not significantly less than existing consumption quantity.
Work Step by Step
With reference to the diagram, the MSB curve is much closer to the MPB curve for the market for dirty water as compared to the market for poison, and thus the externality that dirty water presents is much less than the externality that poison presents.
