Use the Information Below to Answer the Following Questions

question 119

Multiple Choice

Use the information below to answer the following questions.
Fact 6.5.1 Hollywood: Organized Crime Hits the Movies
The Mexican army seized 1,180 disc burners and 3.14 million copies of movies and TV shows from 23 warehouses in a move to fight piracy that costs Hollywood about $590 million a year.
Source: Bloomberg, Businessweek, April 7, 2011
Assume that the marginal cost of producing a DVD (legal or illegal) is a constant $3 and that legal DVDs bear an additional marginal cost of $5 each in royalty payments to film studios.
-Refer to Fact 6.5.1. If a penalty is imposed on either the buyer or the seller, and the penalty is the same, then the marginal benefit

• A)is higher when the penalty is imposes on the seller.
• B)cannot be measured regardless of who pays the penalty.
• C)is the same regardless of who pays the penalty.
• D)is higher when the penalty is imposed on the buyer.
• E)is zero.

---

Definitions:

Thirteenth Amendment

An amendment to the U.S. Constitution, adopted in 1865, that abolished slavery and involuntary servitude, except as punishment for a crime.

Abolishing Slavery

The act or process of ending the practice of enslaving human beings, legally and culturally, often associated with historical movements and legislation.

Senate

The upper chamber of the United States Congress, composed of senators from each state who are elected to serve six-year terms.

Emancipation

The act of freeing slaves from bondage, most prominently known through the Emancipation Proclamation by Abraham Lincoln during the American Civil War.