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Hi there, can you please help with the below question, with diagrams please!
Suppose there is a consumption externality for drug use. Do a standard welfare analysis and propose a Pigovian tax.
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- In 2010 the government’s main medical adviser drew up plans for a minimum price foralcohol intended to double the cost of some drinks.Under the proposal no drinks could be sold for less than 50 pence per unit of alcohol theycontain. This would mean most bottles of wine could not be sold for under £4.50. Theproposal is aimed at reducing alcohol abuse. A spokesman for an opposition party saidthat it was more important to deal with peoples’ attitudes and not just the price of alcohol.The Portman Group, set up by drinks manufacturers to promote sensible drinking, arguesthat it would damage the majority of drinkers who behave responsibly in terms of theirconsumption.The NHS bill for alcohol abuse is an estimated £2.7bn a year. Recent figures showhospital admissions linked to alcohol use have more than doubled in England since 1995.Alcohol was the main or secondary cause of 207,800 NHS admissions in 2006/7,compared to 93,500 in 1995/96. The number of alcohol-related deaths in England…The 2010 health reform law fails to provide universal health insurance coverage. T or F?Discuss the first and second fundamental theory of Welfare Economics.
- What is "Pareto Efficiency"? This is a key concept in welfare economics. Write at least a paragraph to describe this concept and give some examples.19:12 O u 39% & Edit 88 24 4) Cite your references (at least three articles or text book chapters) at the bottom of each answer. 5) Use font size 12 and 1.5-line spacing. 6) Use clearly labelled diagrams RT ONE (PROVIDE HALF PAGE EXPLANATIONS FOR EACH SECTION OF QUESTION ONE) ESTION ONE esent clearly: a) The Fundamental Theorems of Welfare Economics b) The Excess burden doctrine based on the Marshallian Analysis c) The principle of fiscal neutrality d) Maximization behavior of bureaucrats e) The anatomies of market failure and government failure f) Arrow's Impossibility Theorem g) The Internal Rate of Return criterion h) Challenges of designing an efficient tax system in a developing country i) Shortcomings of a highly centralized system of government and how devolution resolves the failures of the centralized government system j) The nature of tax evasion and tax avoidance at the international level k) The Ratchet Effect in Public Expenditure Theory RT TWO (USE AT MAXIMUM TWO (2)…Why does the US government feel that the use of illicit drugs such as cocaine and opium (morphine) should be controlled?
- 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.Ralph will consume any health care service just as long as its MB exceeds the money he must pay out of pocket. His insurance policy has a zero deductible and a 10 percent copay, so Ralph only has to pay 10 percent of the price charged for any medical procedure. Which of the following procedures will Ralph choose to consume? a. An $800 eye exam that has an MB of $100 to Ralph. b. A $90 hearing test that has an MB of $5 to Ralph. c. A $35,000 knee surgery that has an MB of $3,000 to Ralph. d. A $10,000 baldness treatment that has an MB of $16,000 to Ralph.State the first and second fundamental theorem of welfare economics and outline the fundamental differences in the two theorems.
- If the government wishes to make its population pursue a healthier lifestyle by creating a reduction in the demand for packets of cigarettes, examine and discuss how this can be implemented without government having to directly increase the price of a packet of cigarettes. Motivate your answer with a diagram.Provide an example of a government policy or program that you consider paternalistic. Explain how/why it is an example of paternalism. Are there any other reasons you can think of for the policy or program to exist (other than paternalism)?Draw a market where consumers demand health insurance and insurance companies supply insurance at a price of insurance called the premium. Explain why, in this model of the insurance market, the individual mandate (the mandate is everyone has to have insurance) will cause health insurance premiums to increase.
