The Price Elasticity of Demand for Adults for Cigarettes Is

question 127

Essay

The price elasticity of demand for adults for cigarettes is 0.4. If government wants to reduce smoking among adults by 15 percent, by what percentage should it raise the price of cigarettes?
Teenagers have a higher price elasticity of demand for cigarettes than do adults. Suppose the price elasticity of teenagers' demand for cigarettes is 0.8. If the government imposes a tax on cigarettes that raises the price to reduce overall smoking by 15 percent, by what percentage will the government reduce teenage smoking?

---

Definitions:

Conciliatory

Showing willingness to reconcile or make concessions to reach a peaceful resolution.

Aggression

Behavior aimed at causing harm or pain to others, which can be physical or verbal.

Sympathetic Arousal

Activation of the sympathetic nervous system, leading to physiological changes such as increased heart rate and blood pressure, often in response to stress or threat.

Fight or Flight

A physiological reaction that occurs in response to a perceived harmful event, attack, or threat to survival.