This video explains how to think about the tradeoff between externality cost reduction and the deadweight loss of taxation. It also discusses whether producers or consumers should pay corrective taxes. The problem is taken from Principles of Microeconomics, 6th Edition, by N. Gregory Mankiw, and is Ch. 10 problem #2.
You can find more practice problems via the Practice Problem of the Day category archive or by visiting the Econ Classroom page. You can also be notified of new practice problems by subscribing to the YouTube channel.