Which of the following, if true, would most effectively undermine the argument that raising cigarette taxes reduces the number of people who smoke cigarettes?
A) The demand for cigarettes is relatively inelastic.
B) The demand for cigarettes is relatively elastic.
C) The supply for cigarettes is relatively inelastic.
D) The supply for cigarettes is relatively elastic.

Question

Quizplus · Accepted Answer

The demand for cigarettes being relatively inelastic means that consumers' buying habits are not significantly affected by price changes. This undermines the argument that raising taxes (and therefore prices) would reduce smoking, as it suggests people would continue to buy cigarettes despite higher costs.

Which of the Following, If True, Would Most Effectively Undermine