Explain the relationship between the public budget and the demand for public goods.
Assess discrepancies between public budgets and public needs. Explain the relationship between the public budget and the demand for public goods.
100 word requirement
Punitive damage penalties on US cigarette makers
n a court case, U.S. cigarette makers were imposed punitive damage penalties after losing a series of class-action lawsuits alleging the harm caused by cigarettes to smokers and by-standers. The penalties amounted to several hundred billion dollars on the tobacco industry.
In spite of the huge penalties, the media reported that the companies were “doing OK”. It turns out that the addiction of consumers makes demand for cigarettes highly inelastic (unresponsive) to changes in price. Ultimately, the punitive damages on tobacco companies are not really paid out of the companies’ profits, rather they are passed on the cigarette smokers, through the higher prices which they reluctantly accept.
Is it an effective policy for reducing smoking, to impose punitive damages on tobacco companies? What else can policy makers do to reduce smoking?
200 word requirement
Markets and government both allocate scarce resources. Please explain how government adjusts market outcomes though subsidies and whether Pareto efficiencies are achieved. Discuss the role of subsidies in the Affordable Care Act as explained in the assigned article “How Millionaires Get Obamacare Subsidies Intended to Aid the Poor” by Managan.
APA format, reference, & in-text citation for question #1 and question #3