Economics (7th Edition) (What's New in Economics)
7th Edition
ISBN: 9780134738321
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 5, Problem 5.3.9PA
Sub part (a):
To determine
Mortality effect of obesity.
Sub part (b):
To determine
Whether the tax should be on soda or on cigarette.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Economists Kenneth Chay and Michael Greenstone found that in the two years following the passage of the Clean Air Act of 1970, the sharp reduction in air pollution also led to a decline in infant deaths. Although this and other studies provide compelling evidence of the link between pollution and infant health, it is not clear that reductions from the much lower levels of ambient pollution today would have the same effect. Which of the following reasons could explain this?
A.
Today, the level of pollution is much higher. Therefore, it will take a much larger reduction in air pollution to reap benefits similar to those in 1970.
B.
When levels of pollution are high, the marginal benefit of reducing pollution also is high. It follows therefore that the benefit of reducing air pollution in 1970 would be much higher than the benefit from a proportional reduction in air pollution today when the level of pollution is much lower.
C.
When levels of pollution are…
Suppose that Hubert, an economist from an AM talk radio program, and Kate, an economist from a school of industrial relations, are arguing over health insurance. The following dialogue shows an excerpt from their debate:
Kate: A popular topic for debate among politicians as well as economists is the idea of providing government assistance for health benefits.
Hubert: I think it is oppressive for the government to tax people who take care of themselves in order to pay for health insurance for those who are obese.
Kate: I disagree. I think government funding of health insurance is useful to ensure basic fairness.
The disagreement between these economists is most likely due to (DIFFERENCE IN SCIENTIFIC JUDGEMENT, DIFFERENCE IN VALUES, DIFFERENCE BETWEEN PERCEPTION VERSUS REALITY) .
Despite their differences, with which proposition are two economists chosen at random most likely to agree?
A. Employers should not be restricted from outsourcing work to foreign nations.…
Suppose you are told that electronic cigarettes cause health problems such as depression and problems with
arteries. You also are told that electronic cigarettes do NOT produce second-hand smoke, meaning that e-smoking
(called "vaping") by one person does not harm a person standing nearby. How might economists respond?
A standard welfare economist would say that e-smoking imposes an externality if health insurance is pooled and
a. premiums are shared.
A standard welfare economist would say that e-smoking does not increase social costs, unless having health
O b. insurance makes people more likely to use electronic cigarettes.
A behavioral economics would ask if people who use e-cigarettes become addicted.
C.
All of the above.
d.
Chapter 5 Solutions
Economics (7th Edition) (What's New in Economics)
Ch. 5 - Prob. 5.1.1RQCh. 5 - Prob. 5.1.2RQCh. 5 - Prob. 5.1.3RQCh. 5 - Prob. 5.1.4RQCh. 5 - Prob. 5.1.5RQCh. 5 - Prob. 5.1.6PACh. 5 - Prob. 5.1.7PACh. 5 - Prob. 5.1.8PACh. 5 - Prob. 5.1.9PACh. 5 - In a study at a large state university, students...
Ch. 5 - Prob. 5.1.11PACh. 5 - Prob. 5.1.12PACh. 5 - Prob. 5.1.13PACh. 5 - Prob. 5.2.1RQCh. 5 - Prob. 5.2.2RQCh. 5 - Prob. 5.2.3RQCh. 5 - Prob. 5.2.4PACh. 5 - Prob. 5.2.5PACh. 5 - Prob. 5.2.6PACh. 5 - Prob. 5.2.7PACh. 5 - Prob. 5.2.8PACh. 5 - Prob. 5.2.9PACh. 5 - Prob. 5.2.10PACh. 5 - Prob. 5.2.11PACh. 5 - Prob. 5.3.1RQCh. 5 - Prob. 5.3.2RQCh. 5 - Prob. 5.3.3RQCh. 5 - Prob. 5.3.4PACh. 5 - Prob. 5.3.5PACh. 5 - Prob. 5.3.6PACh. 5 - Prob. 5.3.7PACh. 5 - Prob. 5.3.8PACh. 5 - Prob. 5.3.9PACh. 5 - Prob. 5.3.10PACh. 5 - Prob. 5.3.11PACh. 5 - Prob. 5.3.12PACh. 5 - Prob. 5.3.13PACh. 5 - Prob. 5.3.14PACh. 5 - Prob. 5.3.15PACh. 5 - Prob. 5.3.16PACh. 5 - Prob. 5.4.1RQCh. 5 - Prob. 5.4.2RQCh. 5 - Prob. 5.4.3RQCh. 5 - Prob. 5.4.4PACh. 5 - Prob. 5.4.5PACh. 5 - Prob. 5.4.6PACh. 5 - Prob. 5.4.7PACh. 5 - Prob. 5.4.8PACh. 5 - Prob. 5.4.9PACh. 5 - Prob. 5.4.10PACh. 5 - Prob. 5.4.11PACh. 5 - Prob. 5.4.12PACh. 5 - Prob. 5.1CTECh. 5 - Prob. 5.2CTE
Knowledge Booster
Similar questions
- The following diagram shows the market for medical checkup. What are the equilibrium price and quantity of medical checkup? Which kind of externality problems exists in the market for medical checkup? How does this externality problem affect the efficiency of the market? Explain in detail. How can the government solve this externality problem? Explain in detail.arrow_forwardJay Bhattacharya and M. Kate Bundorf of Stanford University have found evidence that people who are obese and work for firms that have employer-provided health insurance receive lower wages than people working at those firms who are not obese. At firms that do not provide health insurance, obese workers do not receive lower wages than workers who are not obese. Source: Jay Bhattacharya and M. Kate Bundorf, "The Incidence of the Health Care Costs of Obesity," Journal of Health Economics, Vol. 28, No. 3, May 2009, pp. 649-58. Firms that provide workers with health insurance may pay a lower wage to obese workers than to workers who are not obese because the former tend to be less healthy and consequently A. more costly to insure and therefore employ due to their higher claim submission rate. B. less productive at work. C. experience higher rates of absenteeism and early retirement. D. all of the above. E. A and B only. Regarding the…arrow_forward"If the production of health care generated positive externalities, the welfare costs of moral hazard would be smaller than suggested by M. Pauly's analysis." Is this statement true, or false? Use a graph to illustrate your answer.arrow_forward
- You read the following from an article on WebMD: "Spending on health care is out of control, and the reasons are that drug companies are exploiting their monopoly positions to raise prices, and doctors are ordering lots of unnecessary tests to protect themselves from lawsuits." What do you think about this quote? Select one: a. These reasons have nothing to do with spending on health care, which is driven mainly by government regulations. O b. It is probably true. Drug companies and doctors actually do those things. O c. It is probably false because drug companies are highly competitive and doctors don't care about lawsuits. O d. It is probably false. These actions could raise prices, but they won't necessarily raise spending.arrow_forwardDuring the time of a pandemic and the existence of a highly contagious corona-virus, many scientists recommended wearing a mask. Let's assume that wearing a mask can limit the spread of the virus. Is wearing a mask an externality? Positive or negative? How about not wearing a mask? Explain your answers.arrow_forwardJohn Cassidy, a writer for the New Yorker magazine, wrote a blog post arguing against New York City’s having installed bike lanes. Cassidy complained that the bike lanes had eliminated traffic lanes on some streets as well as some on-street parking. A writer for the Economist magazine disputed Cassidy’s argument with the following comment: “I hate to belabor the point, but driving, as it turns out, is associated with a number of negative externalities.” What externalities are associated with driving? How do these externalities affect the debate over whether big cities should install more bike lanes? J. Cassidy. Battle of the Bike Lanes. New Yorker, March 8, 2011. The World Is His Parking Spot. Economist, March 9, 2011. Initial Response should be at least 250 words and should include at least one reference in APA format. The Peer Response should be at least 100 words and add value.arrow_forward
- ECON201 Macroeconomics - Associate Professor Jamie J. Muter 5) Chapter 6 Problem 4.14 Some firms offer their employees' health care plans with high deductibles, sometimes as much as $4,500 per year. What effect do high-deductible plans have on how often employees visit doctors or otherwise use health care services? If the federal government were to require that employer health care plans have deductibles that were no greater than $200 per year, would the employees in these plans be better off? Would the employers offering these plans be worse off? Briefly explain. Iarrow_forwardFrom CNN what news article represents an issue ragards to Externalities or that can be realted to externalities? Cite at least one source (News Article, Video, etc.) for any data. Explain: What is the Economic issue? (Describe the issue) What is the connection to Externalities? (positive, negative, policy) (Use Math, Graph or data to explain or support your idea) Explain how this affects the Economy (individual, industry, national or global)arrow_forwardWhich of the following illustrates the concept of externalaties? A. A hurricane destroys a production plant causing the owner of the plant to spend more money rebuilding B. Pollution by a coal mining plant causes a farmer to spend more money on fertilizer to improve his crop C. Increase in the price of sugar raises the price paid by consumers of soda, thereby disadvantaging these consumers D. Smoking harms the health of the smokerarrow_forward
- Briefly explain what is meant by the term "externality" and how it occurs. a. What are the two types of externalities? b.How does government fix both of these issues? c. Is government intervention necessary? Why or why not?arrow_forwardEconomists define the efficient amount of fund pollutants as the amount that minimizes the sum of damage and control costs. Using this definition, they derive two general rules, one of which is that the efficient level of pollution is not generally zero. Briefly explain why this is true.arrow_forwardHistorically, Vaccinations have prevented the spread of certain diseases such as chicken pox or megningtis. What type of externality takes place with the consumption of such vaccines. Explain with words and a graph.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Economics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningMacroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
- Microeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506893Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningEconomics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Microeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning