Final answer:
According to the midpoint method and the price elasticity of demand for cigarettes being 0.4, with a price increase from $2 to $6, smoking should have reduced by 80%.
Step-by-step explanation:
The student has asked how much the government policy changing the price of a pack of cigarettes from $2 to $6 should have reduced smoking, given that the price elasticity of demand for cigarettes is about 0.4, according to the midpoint method. Using the midpoint formula for elasticity, which is (Q2 - Q1) / [(Q2 + Q1) / 2] divided by (P2 - P1) / [(P2 + P1) / 2], and the provided elasticity of 0.4, the calculation would show how the change in price should affect the quantity demanded. However, the exact quantity change is not provided here; hence, we must use an estimated percentage change in quantity based on elasticity and the price change. The percentage change in price is 200% (from $2 to $6, which is an increase by $4 on the base price of $2).
To find the percentage change in quantity demanded (Q%), we rearrange the formula of elasticity (E = Q% / P%) to Q% = E * P%. Substituting the values gives us Q% = 0.4 * 200%. This results in a reduction of 80% in the quantity demanded, according to the price elasticity of demand. Therefore, the correct answer is (c) 80%.