CCC Increase in Taxes Relationship on Demand & Supply Discussion

There are two discussion questions. You will need to answer both questions in order to receive full credit.

Discussion Questions:

1. What would be the effect of a 75 percent tax on lawsuit punitive awards that was proposed by then California governor Arnold Schwarzenegger in 2004 on:
   • The number of punitive awards. Demonstrate your answer using supply and demand curves. (You will post your graph as jpg. in your discussion post).
   • The number of pretrial settlements.
2. Airlines and hotels have many frequent-flyer and frequent-visitor programs in which individuals who fly the airline or stay at the hotel receive bonuses that are the equivalent to discounts.

• • Give two reasons why these companies have such programs rather than simply offering lower prices.
  • Can you give other examples of such programs?
  • What is a likely reason why firms whose employees receive these benefits do not require their employees to give benefits to the firm?

– one paragraph per question should be fine.

– original work only please. no plagiarism.

– must have evidence that support each question. can be taken from a website but must be cited.