Q. Sometimes market activities (production, buying, and selling) have unintended positive or negative effects outside the market's scope. These are called externalities. As a policy maker concerned with correcting the effects of gases and particulates emitted by and local power plant, answer the following questions:

1. What two policies could you use to reduce the total amount of emissions?

2. Why do you thing they each would work.

3. Illustrate what would the benefits of each action be (besides emissions reduction)?

4.what would the cost of each action be?

5.how would you decided what was the best level of emission reduction?