2. Suppose that a per-unit tax of 25 centavos per pack is placed on the sale of cigarettes by the government, shifting the market supply of cigarettes from S1 to S2 as shown. Answer the following questions regarding this case. Price (S per pack) 1.60- 1.40 1.30 1.20 LIS 1.00 0.80- 060 0.40 0.20 Quantity (Millions of pack per year)

2. Suppose that a per-unit tax of 25 centavos per pack is placed on the sale of cigarettes by the government, shifting the market supply of cigarettes from S1 to S2 as shown. Answer the following questions regarding this case. Price (S per pack) 1.60- 1.40 1.30 1.20 LIS 1.00 0.80- 060 0.40 0.20 Quantity (Millions of pack per year)

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter8: Application: The Cost Of Taxation

Section: Chapter Questions

Problem 10PA

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