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A Negative Externality Arises When a Person Engages in an Activity

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A negative externality arises when a person engages in an activity that has


Definitions:

Per Capita Consumption

The average consumption of goods and services per person within a particular population.

Cigarette Tax

A tax imposed by governments on the sale of cigarettes to raise revenue and discourage smoking by increasing the price.

Cigarette Prices

The retail cost of cigarettes, which can be influenced by factors such as taxes, production costs, and demand.

Elastic Demand

A demand situation where the quantity demanded of a good or service changes significantly when its price changes.

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