According to this Application, after the government deceased cigarette taxes in several Canadian provinces in 1994, the decrease in the price of cigarettes in these provinces
A) increased the smoking rate by roughly 17 percent
B) more than doubled the smoking rate.
C) created no noticeable change in the smoking rate.
D) was accompanied by a slight decrease in the rate of smoking.
Question 2
Decreases in consumption, investment, or net exports caused by an increase in government purchases are known as
A) strategic substitution. B) crowding out.
C) diminishing returns. D) demand-side effects.