In each of the following cases, determine whether an external cost or an external benefit is imposed and what an appropriate policy response would be.

a. Trees planted in urban areas improve air quality and lower summer temperatures.

b. Water-saving toilets reduce the need to pump water from rivers and aquifers. The cost of a gallon of water to homeowners is virtually zero.

c. Bottled drinks are packaged in plastic that does not decompose when discarded. Asa result, they take up vast amounts of landfill space or must be burned, releasing pollutants.