Zoe,Chloe,and Brody each like to read novels.The current mystery thriller costs $10.Zoe values it at $15,Chloe at $13,and Brody at $11.Suppose that if the government taxes books at 50 cents each the selling price rises to $10.50.A consequence of the tax is that
A) consumer surplus shrinks by $1.50 and tax revenues increase by $1.50, so there is no deadweight loss.
B) consumer surplus shrinks by $9.00 and tax revenues increase by $1.50, so there is a deadweight loss of $7.50.
C) consumer surplus shrinks by $7.50 and tax revenues increase by $7.50, so there is no deadweight loss.
D) consumer surplus shrinks by $7.50 and tax revenues increase by $1.50, so there is a deadweight loss of $6.
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