Suppose the state of Colorado imposes a one dollar per pack tax on cigarettes, which increases their price by 30 percent, and as a result, the quantity sold declines by 20 percent. The absolute value of the price elasticity of demand for cigarettes is equal to
a. 0.20.
b. 0.67.
c. 1.50.
d. 3.00.
B
You might also like to view...
Which of the following is the most likely explanation for inflation in the United States?
A) decreases in aggregate demand B) decreases in aggregate supply C) increases in aggregate demand D) increases in aggregate supply
Which of the following has been found to be most effective in improving the quality of education?
A. Training women in the community to offer supplemental lessons B. Distributing textbooks C. Providing parents with information about the quality of the children's schools D. Forcing students to study longer at home
In an economy consisting of two people producing two goods, it is possible for one person to have the absolute advantage and the comparative advantage in both goods
a. True b. False Indicate whether the statement is true or false
The gains from specialization and trade are based on ______ advantage
Fill in the blank(s) with correct word