For each of the following policies explain whether the polic

For each of the following policies, explain whether the policy is correcting a market failure or pursuing some other societal goal. Be sure to identify the goal. Using diagrams where possible, describe the efficiency impact of the policy. To simplify your analysis, assume that the marginal private cost (MPC willingness-to-accept) is constant and ignore the efficiency costs of taxation (where applicable) (a) Since flu vaccinations not only benefit the vaccinated (decreasing their chance of getting the flu), but also benefit everyone else in the same way, the Ontario government funds flu shots from taxation and (b) Many governments have banned smoking in restaurants because they are worried about the effects of (c) The Canadian government has made many medical/health-related transactions illegal (ex. trade in (d) In Canada, health care (even for non-communicable diseases) is provided by the government and distributes them for free to the population. second-hand smoke on the health of non-smoking diners body organs, payments for pregnancy surrogates, etc.) funded through progressive taxation.

Solution

a) The policy is correcting a market failure as of now there will be no free ridership problem associated with the vaccination program i.e. no one will benefit from vaccination without pying for it as it is free for everyone thus benefitting all in the economy.

b) No, the policy is not correcting the market failure as there will be inefficient level of pollution because the property rights are with the non-smokers and there is no trade so as to maintain equilibrium in the market.

* for solution to other parts please post as a separate question. We are supposed to solve only these many problems.