Demand Elasticity
Please, read the article Hainer, R. (2010), provided in the
required readings section for this week. The tobacco industry is a
prime example to consider when talking about price elasticity of
demand. While nicotine use can be addictive for many users, it is
not addictive for the so-called "social smokers".
What can we say about the price elasticity of demand for
nicotine products (such as cigarettes, pipes, tobacco) in the group
of nicotine addicted users, versus the group of "social smokers"?
Can we say whose demand is likely to be more elastic? Why?
Guided Response:
Provide your response to the discussion question in 300 words
or more. Further, comment on the effectiveness of government policy
aimed at reducing the negative effects of smoking on health. For
example, consider high taxation on producers? – is that effective?
Respond substantively to at least two of your classmates’ postings.
Substantive responses use theory, research, and experience or
examples to support ideas and further the class knowledge on the
discussion topic.
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