This economics assignment explores the elasticity of demand for various food categories, highlighting the implications of taxes and subsidies on consumer behavior and public health. The analysis reveals that unhealthy foods exhibit inelastic demand, suggesting that taxes can effectively reduce their consumption, while subsidies on healthy foods can promote better eating habits. The assignment also examines Keynesian economics, emphasizing the role of demand-side interventions, such as fiscal and monetary policies, in addressing economic downturns and recessions. It discusses the use of government expenditure, interest rate adjustments, and tax policies to stimulate demand, stabilize the economy, and manage budget deficits. The document further contrasts fiscal and monetary policies, highlighting the advantages of monetary policy in terms of quicker response times and reduced political influence.