For each of the cases below, please answer the following: 1. Does an externality exist? Explain why or why not. If an externality does exist, classify the externality as positiveegative (or both). Case #1: An oil company drills for oil in the southern U.S. gulf coast Case #2: Your upstairs neighbors throwing an awesome, but loud party.Instructions: Answer the following questions. Please ensure that you provide all steps for mathematical solutions and label all your variables or parameters clearly. Graphs are to be drawn neatly and fully labelled. Formal language is required for written answers, including complete sentences and proper use of punctuation