1. You are a government minister. What arguments might you put forward in favour of maximising the revenue from cigarette taxation?

2. What is the likely impact on businesses and individuals of the ban on smoking in public places?

3. As we saw in the box, a HMRC study on smoking estimates the long-term elasticity of demand as –1.19, with a short-term elasticity of –0.57. Explain these figures.

4. Many people think that if tobacco were to be discovered today it would be an illegal substance, as is the case with cannabis. What problems would face a government trying to ban smoking completely (see section 3.3)?