Economists have made estimates of the price elasticity of demand for a variety of goods and  services.  i. What is price elasticity of demand and why is it important to estimate it? Provide your  own examples to support your answer.  ii. The government commissioned a research firm, Super Consulting, to conduct a study  on the market demand for cigarettes. The firm reported that the price elasticity of  demand for cigarettes is about 0.4. If a pack of cigarettes costs $2 and the government  wants to reduce smoking by 20 percent, by how much should the price increase using  the midpoint method?

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