Economics 20th Edition by Campbell McConnell ,Stanley Brue ,Sean Flynn

Exercise 8

Explain why zoning laws, which alcertain land uses only in specific might be justified in dealing with a problem of negative externalities. Explain why in areas where buildings sit ctogether tax breaks to property owners for installing extra fire prevention equipment might be justified in view of positive externalities. Explain why excise taxes on beer might be justified in dealing with a problem of external costs. LO5