Dave's Consumer Surplus on Movie Rentals Per Week

question 23

Multiple Choice

Dave's Consumer Surplus on Movie Rentals per Week
(yes,we know no one rents movies anymore,but it makes a good example!)
TABLE 6-2
-Refer to Table 6-2.How many movies will Dave rent per week such that the consumer surplus on the last unit is zero?

• A)1
• B)3
• C)5
• D)6

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Definitions:

Arbitragers

Individuals or entities that attempt to profit from price differences of the same or similar financial instruments, on different markets or in different forms.

Market Inefficiency

A condition where all available information is not fully incorporated into asset prices, leading to opportunities for higher returns.

Siamese Twin Companies

Companies listed in different countries that share an operational business but trade separately on the stock exchange.

Equity Carve-Outs

A type of corporate restructuring where a company creates a new, independent company by selling or distributing new shares of its existing division or subsidiary.