Table 7-5 For Each of Three Potential Buyers of Oranges, the Table

question 100

Multiple Choice

Table 7-5
For each of three potential buyers of oranges, the table displays the willingness to pay for the first three oranges of the day. Assume Allison, Bob, and Charisse are the only three buyers of oranges, and only three oranges can be supplied per day.
-Refer to Table 7-5. Who experiences the largest gain in consumer surplus when the price of an orange decreases from $1.05 to $0.75?

• A)Allison
• B)Bob
• C)Charisse
• D)Allison and Bob experience the same gain in consumer surplus, and Charisse's gain is zero.

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Definitions:

Market Value

The immediate cost at which one can buy or sell a service or asset.

IRS

The Internal Revenue Service, the U.S. federal agency responsible for administering and enforcing the tax laws and collecting federal taxes.

Tax Return

A form or forms filed with a government body reporting income, expenses, and other pertinent tax information, used to calculate tax liability.

Financial Statements

Formal records of the financial activities and condition of a business, person, or other entity, typically including a balance sheet, income statement, and cash flow statement.