Use the Following to Answer Question

question 46

Multiple Choice

Use the following to answer question:
-(Figure and Table: The Market for Taxi Rides) Use Figure and Table: The Market for Taxi Rides.If the government imposes an excise tax of $1 per ride (causing the supply curve to shift upward by that amount) ,then the government will collect tax revenues of _____.However,the tax will cause a _____ deadweight loss to society.

• A)$9 million;$0.5 million
• B)$16 million;$1 million
• C)$45 million;$1 million
• D)$50 million;$0.5 million

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Definitions:

Prepaid Expense

Expenses paid in advance and recorded as assets before they are used or consumed.

Consumed

Consumed refers to the portion of resources, goods, or services that have been used up in the process of generating revenue.

Accounting Period

A specific period of time covered by financial statements, usually encompassing a fiscal quarter or year.

Contra Account

An account used in accounting to record reductions of related accounts, which has a balance opposite to the normal balance of the related account.