Recall the Application About the Decrease in Taxes on Cigarettes

question 179

Multiple Choice

Recall the Application about the decrease in taxes on cigarettes in several Canadian provinces in 1994 to answer the following question(s) .
-According to the Application,when the Canadian government lowered the price of cigarettes by lowering the tax rates,the response of the consumer was

• A) an increase in quantity demanded.
• B) an increase in demand.
• C) a decrease in demand.
• D) a decrease in quantity demanded.

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Definitions:

Note Receivable

A written promise for amounts to be received by a creditor from a debtor, typically generating interest income for the holder.

Interest

The cost of borrowing money or the payment received for the investment of money, typically expressed as a percentage of the principal.

Maturity Value

Maturity Value is the amount payable to an investor at the maturity date of a financial instrument, typically including the principal and the interest.

Note Receivable

A written promise to pay a specified amount, usually interest-bearing, that is recognized as an asset on the lender's balance sheet.