Zoe,Chloe,and Brody Each Like to Read Novels

question 320

Multiple Choice

Zoe,Chloe,and Brody each like to read novels.The current mystery thriller costs $10.Zoe values it at $15,Chloe at $13,and Brody at $11.Suppose that if the government taxes books at 50 cents each the selling price rises to $10.50.A consequence of the tax is that

• A) consumer surplus shrinks by $1.50 and tax revenues increase by $1.50, so there is no deadweight loss.
• B) consumer surplus shrinks by $9.00 and tax revenues increase by $1.50, so there is a deadweight loss of $7.50.
• C) consumer surplus shrinks by $7.50 and tax revenues increase by $7.50, so there is no deadweight loss.
• D) consumer surplus shrinks by $7.50 and tax revenues increase by $1.50, so there is a deadweight loss of $6.

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Definitions:

Psychological Well-Being

An individual's overall emotional health, including aspects such as self-acceptance, purpose in life, and quality of relationships.

Post Divorce Adjustment

The process of emotional, psychological, and practical adaptation following the dissolution of a marriage, involving coping with changes in living arrangements, financial status, and personal identity.

Forgiveness

Counteracting the natural tendencies to seek vengeance or avoid an offender, thereby releasing this person from further liability for his or her transgression.

Risk of Divorce

The likelihood or probability that a marriage will end in divorce, influenced by various factors such as communication patterns and financial stress.