Explain why zoning laws, which allow certain land uses only in specific locations, might be justified in dealing with a problem of negative externalities. Explain why tax breaks to businesses that set up in areas of high unemployment might be justified in view of positive externalities. Explain why ex- cise taxes on beer might be justified in dealing with a prob- lem of external costs.

(A) Zoning Laws: As certain activities generate negative externalities to neighbors zoning prevents this. As the factory noises and smells are taken away. Also, the traffic of large trucks going towards the factory to provide raw materials and taking finished goods.

As a side note, it also creates positive externalities when commercial zoning is applied as generates more trade value

(B) tax breaks: The tax-break decreases the financial cost of operation in the are making profitable more project thus, giving more attraction to investment to generate jobs and lower unemployment in the area.

(C) excise tax is levied on manufacturing: As beer generates alcoholism, beer producers don't have to deal with it. There is a social cost not included in the brewing process. Thus, the excise tax represents that.

This type of tax usually has a specific destination to engage in the social cost. In this case, alcoholism.

Explanation:

The answer is the explanation.