Suppose that bob places a value of $10 on a movie ticket and that lisa places a value of $7 on a movie ticket. in addition, suppose the price of a movie ticket is $5. 15. refer to scenario 12-2. suppose the government levies a tax of $3 on a movie ticket and that, as a result, the price of a movie ticket increases to $8. what is total consumer surplus after the tax is imposed?

$1

Explanation:

We can use the simple consumer surplus formula:

Consumer surplus = Maximum Price Willing to Pay - Actual Price

For Bob

Consumer Surplus = $10 - $8

                              = $2

For Lisa

Consumer Surplus = $7-8

                               = $-1

So, the total consumer surplus is $1

explanation:

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cognitive overload: having a lot on your mind impairs decision-making and tends to result in the simplest, but not necessarily best, option being selected.

empathy gaps: overlooking how you might feel in a different situation can result in unnecessary purchases, such as overbuying when shopping for food on an empty stomach.

optimism and overconfidence: wearing rose-tinted glasses and having unrealistic expectations about the future can affect money management and leave you unprepared for a change in circumstance.

instant gratification: seeking instant gratification drives impulsive spending and can undermine long-term planning and savings.

harmful habits: automatic or mindless behaviour can amplify a poor financial decision as it becomes a recurring event.

social norms: we are heavily influenced by the actions of others; while this can be in certain circumstances, it also contributes to the pressure to keep up with the joneses through conspicuous consumption.