Suppose There Is Only One Movie Theatre in a Town

question 18

Multiple Choice

Suppose there is only one movie theatre in a town and the equilibrium price and quantity for movie admissions is $9 and 850 visits per week.Now suppose the government imposes a tax such that the new equilibrium price and quantity are $10.50 and 780 visits per week.What is the direct burden of this tax?

• A)$105
• B)$1170
• C)$1275
• D)$0
• E)There is not enough information to know.

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Definitions:

Verbal Behaviors

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Expressing Feelings

The communication of one's emotional states to others through words, actions, or artistic expression.

Nonverbal Messages

Information conveyed without words, using gestures, body language, facial expressions, and other visual cues.

Verbal Messages

Communication through spoken, written, or signed words.