Suppose there are external costs associated with the production of cement. This

Question

Suppose there are external costs associated with the production of cement. This means that government can best promote efficiency in the cement market by:

giving a tax break to cement manufacturers to induce higher production levels.

passing zoning restrictions to prevent cement plants from locating in residential
neighborhoods.

protecting consumers from high prices using a subsidy.

negotiating trade agreements to increase export of this product and raise the demand.

giving a tax break to cement manufacturers to induce higher production levels.

passing zoning restrictions to prevent cement plants from locating in residential
neighborhoods.

protecting consumers from high prices using a subsidy.

negotiating trade agreements to increase export of this product and raise the demand.

Explanation / Answer

B passing zoning restrictions to prevent cement plants from locating in residential neighborhoods.

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