Scenario 12-1
Suppose Jeremy and Kelsey receive great satisfaction from their consumption of turkey.Kelsey would be willing to purchase only one slice and would pay up to $5 for it.Jeremy would be willing to pay $8 for his first slice, $6 for his second slice, and $2 for his third slice.The current market price is $2 per slice.
-Refer to Scenario 12-1.If a tax of $4 is levied on each slice of turkey,who bears the deadweight loss
A)Jeremy will bear the full burden of the deadweight loss.
B)Kelsey will bear the full burden of the deadweight loss.
C)Both Kelsey and Jeremy will share the burden of the deadweight loss.
D)There will be no deadweight loss.

Question

Quizplus · Accepted Answer

The Answer of Scenario 12-1
Suppose Jeremy and Kelsey receive great satisfaction from their consumption of turkey.Kelsey would be willing to purchase only one slice and would pay up to $5 for it.Jeremy would be willing to pay $8 for his first slice, $6 for his second slice, and $2 for his third slice.The current market price is $2 per slice.
-Refer to Scenario 12-1.If a tax of $4 is levied on each slice of turkey,who bears the deadweight loss
A)Jeremy will bear the full burden of the deadweight loss.
B)Kelsey will bear the full burden of the deadweight loss.
C)Both Kelsey and Jeremy will share the burden of the deadweight loss.
D)There will be no deadweight loss.

Scenario 12-1 Suppose Jeremy and Kelsey Receive Great Satisfaction from Their Consumption