Suggest How An Economist Would Approach The Problem Of Alcohol Abuse

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1. Suggest how an economist would approach the problem of alcohol abuse. Provide two (2) possible solutions to this problem. Include the four (4) elements of the economic way of thinking in your analysis. a. An economist may use statistics and mathematical predictions to determine those who have the 'highest rate hit" of turning to alcoholism and provide these individuals with prevention treatment whilst monitoring them. This would prevent accumulating costs later. b. Economists may suggest Piglovian taxes or regulations which include regulations on drunk driving The four elements are the following: Economists use assumptions to simplify They isolate variables that may be causing the problem They think in terms of profit and loss and lowest margin factors. They realize that rational people respond to incentives 2. Analyze how prescription drugs affect the demand and supply of other products and services in this country. Prescription drugs are related to over the counter drugs. With increase of prescription drugs, demand for OC drugs falls. The reverse is the case too: reduction in demand for prescription drugs will cause rise in OC drugs. On the other hand, with increase in prescription drugs, there may be too increase in OC drugs and other related products (such as vitamins and food items to essay pain and bitter taste). Demand in OC drugs too may occur since prescription drugs may be costly for some. 3. Formulate a reason why the elasticity of demand is

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