The amount of smoking of cigarettes is decreasing in Australia. This is because of the tax increase of cigarettes in Australia, which then increases the price. Therefore the demand for cigarettes decreases whilst the supply stays the same. Due to the price increasing, the amount of cigarettes sold will decrease. Using this information a supply demand graph can be constructed. If the price were to decrease the demand for cigarettes would increase, causing a shift to the right, but because this is not the case, there is instead a shift to the left. Figure 2 shows the shift to the left causing efficient equilibrium.
There are a couple strategies to get an efficient equilibrium. One of these strategies being price floor, due to the fact that Australia will never have 0% of smokers in Australia, and also because