Suppose Max Values a Concert Ticket at $45

question 323

Multiple Choice

Suppose Max values a concert ticket at $45. Charles values the same concert ticket at $40. The pre-tax price of a concert ticket is $30. The government imposes a tax of $5 on each concert ticket, and the price rises to $35. The deadweight loss from the tax is

• A)$15.
• B)$10.
• C)$5.
• D)$0.

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Definitions:

Inventory

The total amount of goods and materials held by a business, intended for sale or used in production.

Inventory Investment

The purchase of goods and materials for future sale or use, regarded as a form of investment by a company.

GDP

Gross Domestic Product, which measures the total value of all goods and services produced within a country’s borders in a specific time period.

Partnership

A lawful business structure operated by two or more people who jointly manage and divide profits.