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Cigarettes
– A De-Merit Good?
As we have previously discussed most goods
have elements of positive and negative externalities. Cigarettes have some obvious negative externalities, but there are some
positive ones as well that aren’t often stated.You are to produce a report that lists all of the positive
and negative externalities that arise from the consumption of cigarettes.
It is necessary for you to arrive at a conclusion, i.e., which
externality is greater and is the social optimum above or below the private one?
Should the government intervene in the cigarette market?
In order to research for this report you
may wish to visit the following sites:
www.lifesaver.co.uk
www.the-tma.org.uk
http://uk.fc.yahoo.com/t/tobacco.html
As well as using various search engines.
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