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Smoking disease costs NHS £5bn – Negative externalities revision

Jim Riley

10th June 2009

Last week I wrote that smoking is costing businesses £2.1bn due to sickness and time wasting breaks. Researchers have now calculated that smoking disease costs the NHS £5bn a year, five times more than previously thought. This article along with the one last week would be perfect for revising negative externalities. I have also written some more GCSE style questions to go with it.

1. State one other negative externality associated with smoking (1 mark)
2. Discuss possible ways of reducing negative externalities associated with smoking. Which one do you think would be most successful? Give reasons for your answer. (8 marks)
3. Explain one other reason for taxation of tobacco, apart from the reduction of negative externalities (3 marks)

Jim Riley

Jim co-founded tutor2u alongside his twin brother Geoff! Jim is a well-known Business writer and presenter as well as being one of the UK's leading educational technology entrepreneurs.

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