Question text Statistical evidence shows that Select one: tax rates reduce smoking and demand is generally...

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Question text Statistical evidence shows that Select one: tax rates reduce smoking and demand is generally...

Question text

Statistical evidence shows that

Select one:

tax rates reduce smoking and demand is generally highly elastic.

any of these could be true.

tax rates reduce smoking but demand is generally inelastic.

tax rates have no effect on smoking patterns because addicts do not respond to price incentives.

business economics

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Answer 1

Answer #1

Tax rates have no effect on smoking patterns beacuse of addiction problem but people will now indulge in crime to buy such things those can't afford it. They do not respond to increase in price because of perfectly inelastic demand.

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Answer 2

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