What can we say about the price elasticity of demand for nicotine products (such as cigarettes, pipes, tobacco)

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.

Article is

Hainer, R. (2010). Social smokers aren’t hooked on nicotine, just smoking. Cable News Network. Retrieved from Weather, Entertainment & Video News. Retrieved November 13, 2012, from ttp://www.cnn.com/2010/HEALTH/04/24/social.smokers/index.html

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Demand elasticity of a product refers to how sensitive the demand of that product is as a result of changes in economic conditions. It is an important economic aspect as a business is able to foretell potential change of demand of its product due to economic changes such as change in prices. Price of elasticity of demand therefore refers to how the demand of a product is sensitive to rice changes. In this case, we focus on….

APA

398 words

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