Many US States Have Minimum Price Laws for Cigarettes

question 23

Essay

Many U.S. states have minimum price laws for cigarettes. Assume that the demand equation for cigarettes is Q^D = 4,000 - 300P and the supply equation is Q^S = -1,000 + 200P, with quantity in thousands of packs. The number of cigarette packs actually sold when a binding price floor of $12 is applied to this market will be _____.

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Definitions:

Beneficiary

A person or entity entitled to receive benefits or funds under a will, insurance policy, retirement plan, or other contract.

Form W-4

A tax form completed by an employee to indicate his or her tax situation, such as exemptions and status, to the employer.

Dependents

Individuals, typically family members, who rely on another person, usually the primary earner, for financial support and are often covered by that person's health insurance policies.

Tax Purposes

Refer to the reasons or activities for which financial and transactional information is used to comply with taxation laws and regulations.