Scenario 12-2 Suppose Roger and Regina Receive Great Satisfaction from Their Consumption

question 84

Multiple Choice

Scenario 12-2
Suppose Roger and Regina receive great satisfaction from their consumption of cheesecake. Regina would be willing to purchase only one slice and would pay up to $8 for it. Roger would be willing to pay $11 for his first slice, $9 for his second slice, and $5 for his third slice. The current market price is $5 per slice.
-Refer to Scenario 12-2.Assume that the government places a $2 tax on each slice of cheesecake and that the new equilibrium price is $7.What is the deadweight loss of the tax?

• A) zero
• B) $3
• C) $6
• D) $8

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Definitions:

Cell body

The main part of a neuron or other cell, containing the nucleus and various organelles.

Organelles

Specialized structures within a cell that perform specific functions necessary for the cell's life.

Axon

A type of nerve fiber that is typically long and branches far from the cell body. Its function is to send information away from the cell body.

Cervical enlargement

describes the widened area of the spinal cord in the neck region that contains nerves that supply the arms.