What will happen to the quantity of cigarettes demanded, Macroeconomics

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What will happen to the quantity of cigarettes demanded

The elasticity of demand for cigarettes is calculated to be about - 0.5. Suppose the elasticity of supply of cigarettes is 1

1. How much will the price of cigarette increase (approximately) if the government places a tax of $0.60 on cigarettes?

2. What will happen to the quantity of cigarettes demanded after the tax is implemented? Assume the price of cigarettes was $40 before the price increase.

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Macroeconomics: What will happen to the quantity of cigarettes demanded

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Macroeconomics: What will happen to the quantity of cigarettes demanded

Reference No:- TGS0871884

Have a Question? (oR Write a Review)

Recent Questions Asked Macroeconomics

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Ask an Expert for Answer!!

Macroeconomics: What will happen to the quantity of cigarettes demanded

Reference No:- TGS0871884

Recent Questions Asked Macroeconomics

Q : Illustrate how a change in the overtime rate may lead

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