Identify any major market failures

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1. Supporters of accelerated depreciation in 1981 acknowledged that it favored heavy industry ("smokestack America") but argued that this was desirable. Why do economist tend to look askance at such arguments? Can you identify any major market failures? If it were decided to subsidize these industries, in what other ways might it be done?

2. In the debate concerning repeal of the provision allowing capital gains on assets passed on to one’s heirs to escape taxation, some have reasoned that death is not voluntary, and therefore one should not tax capital gains upon death. Evaluate

Reference no: EM131096760

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