If an Increase in the Excise Tax Imposed on Cigarettes

question 133

Multiple Choice

If an increase in the excise tax imposed on cigarettes pushes the price per pack up by 20 percent, and the quantity sold declines by 8 percent as a result, the price elasticity of demand for cigarettes is equal to

• A) −0.2.
• B) −0.4.
• C) −0.8.
• D) −5.

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Definitions:

Night Terrors

Sudden episodes of fear that occur during sleep, typically affecting children.

REM Sleep

A stage of sleep characterized by rapid eye movements, during which dreaming and increased brain activity occur, vital for cognitive functions like memory.

Non-REM Sleep

A period of sleep that excludes rapid eye movement (REM) sleep, characterized by slower brain waves, and divided into three stages of deepening sleep.

Narcolepsy

An ongoing sleep disturbance featuring overbearing drowsiness during daylight hours and unexpected sleep onset.