Answered: Why are taxes, one traditional remedy…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Question

Why are taxes, one traditional remedy for negative externalities, less than ideal for smoking cessation in the United States?

Nicotine is addictive/demand is inelastic, and smokers are mostly poor, so in effect cigarette taxes reduce the quality of life of people we’re trying to help without substantially reducing smoking

Demand is inelastic, and smokers are mostly rich, so they don’t reduce smoking as a result of taxes

Demand is elastic, and smokers are mostly old, so taxes reduce smoking but cause increased anxiety among the elderly

Demand is elastic, and smokers are mostly young, so they quit smoking but are then more likely to experiment with illegal drugs

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions