Which of the following goods is excludable but not rival in consumption? a, fire
ID: 2429423 • Letter: W
Question
Which of the following goods is excludable but not rival in consumption? a, fire protection in a small town b. a tornado siren c. a congested toll road d. whales in the ocean OC. QUESTION 11 Table 12-2 Hot Fudge 10 points Save Answer Brownie Delight alue to Ricky Value to Luc S9.00 S5.00 Refer to Table 12-2. Suppose that the government imposes a $2 tax on delights, causing the price to increase from $4.00 to $6.00. Total consumer surplus will fall from a. $7 to $4 b. $5 to $:3 c. $6 to $2 d. $6 to $.2Explanation / Answer
(Question 1) Option (c)
People can be excluded from using a specific road, but the road itself is non-rival in consumption. Use of the road by one user does not reduce the amount of road available for use by another user.
(Question 11) Option (b)
Consumer surplus (CS) = Maximum willingness to pay - Market price paid
Initial CS = $(9 - 4) + $(5 - 4) = $5 + $1 = $6
New CS = $(9 - 6) = $3 (Since market price of $6 is higher than Lucy's maximum willingness to pay, she will not buy the good).
(Scenario 12-3) Option (a)
After the tax, market price of $9 is higher than Regina's maximum willingness to pay ($8), so she will not buy the cheesecake. Roger being the remaining consumer, will bear the full deadweight loss.
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