Solved

Refer to Scenario 3

Question 85

Multiple Choice

Refer to Scenario 3.1 below to answer the question(s) that follow.
SCENARIO 3.1
-Streaming movies and movies shown in theaters are substitutes.
-Streaming movies and OLED TVs are complements.
-OLED TVs and movies shown in theaters are normal goods.
-People watch streaming movies more often in the winter than in the summer.
-Refer to Scenario 3.1. To raise additional revenues, the government imposes an entertainment tax on movie tickets, but there are no new additional taxes levied on streaming movies. This would lead to


A) an increase in the price of movie tickets, but no change in the price of streaming movies.
B) an increase in the price of movie tickets and the price of streaming movies.
C) an increase in the price of a movie ticket and a decrease in the price of streaming movies.
D) no change in the price of a movie ticket and an increase in the price of streaming movies.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents