Elvis Values the First Gravy Sandwich at $5, the Second

question 128

Multiple Choice

Elvis values the first gravy sandwich at $5, the second at $4.50, the third at $4.If he buys three for $4 each, his consumer surplus is

• A)$5
• B)$4
• C)$1.50
• D)$9.50
• E)$12

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Definitions:

Expense Deduction

An expenditure that is subtracted from gross income to reduce the amount of income that is subject to taxation.

Airfare

The cost or price of a ticket for travel by airplane.

Social Security Tax Rate

The tax rate applied to both employers and employees to fund the Social Security program.

Income Limit

The maximum amount of income that allows for eligibility for certain tax benefits or programs.