Scenario 12-2 Suppose That Bob Places a Value of $10 on a on a Movie

question 134

Multiple Choice

Scenario 12-2
Suppose that Bob places a value of $10 on a movie ticket and that Lisa places a value of $7 on a movie ticket. In addition, suppose the price of a movie ticket is $5.
-Refer to Scenario 12-2. Suppose the government levies a tax of $1 on a movie ticket and that, as a result, the price of a movie ticket increases to $6. If Bob and Lisa both purchase a movie ticket, what is the deadweight loss from the tax?

• A)$0
• B)$1
• C)$2
• D)$3

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