Discussion: Junk Food and Elasticity

This discussion can be found in Google Docs: Macroeconomics Discussion: Junk Food and Elasticity

To make your own copy to edit:

  • If you want a Google Doc: in the file menu of the open document, click “Make a copy.” This will give you your own Google Doc to work from.
  • If you want a PDF or Word file: in the file menu of the open document, click “Download” and select the file type you would like to have (note: depending on the file type you select, the formatting could get jumbled).
  • Instructions for faculty to paste the content into their LMS are located in the course resource pages.

 

Respond to the following prompts in a post with a minimum of 200 words, then comment on at least TWO other posts.

  • Recently there has been discussion in the news about taxing junk food (soft drinks, for example) in an effort to reduce the incidence of obesity in the U.S. Do you think the demand for junk food is elastic or inelastic with respect to price?
  • Based on your knowledge of the price elasticity of demand, do you think the deadweight loss of a soda/junk-food tax would be relatively large or relatively small? Why? Do you think taxing junk food would be a good idea? Based on your analysis, would it really help reduce the number of obese people in the United States? Explain.