Table 12-1

$$\begin{array} { | c | c | }
\hline \text { Person } & \begin{array} { c }
\text { Value of a White Water Rafting } \
\text { Trip } \
\text { (Dollars) }
\end{array} \
\hline \text { Ken } & 150 \
\hline \text { Alex } & 120 \
\hline \text { Brenda } & 90 \
\hline \text { Rob } & 60 \
\hline
\end{array}$$
-Refer to Table 12-1. Assume that the price of a white water rafting trip pass is $55 and that the price reflects the actual unit cost of the trip. Suppose the government imposes a tax of $12 on white water rafting, which raises the price to $67. What is the value of the surplus that accrues to all four participants?
A)$200
B)$83
C)$159
D)$53

Question

Table 12-1
​
​
 $$\begin{array} { | c | c | } 
\hline \text { Person } & \begin{array} { c } 
\text { Value of a White Water Rafting } \
\text { Trip } \
\text { (Dollars) }
\end{array} \
\hline \text { Ken } & 150 \
\hline \text { Alex } & 120 \
\hline \text { Brenda } & 90 \
\hline \text { Rob } & 60 \
\hline
\end{array}$$
-Refer to Table 12-1. Assume that the price of a white water rafting trip pass is $55 and that the price reflects the actual unit cost of the trip. Suppose the government imposes a tax of $12 on white water rafting, which raises the price to $67. What is the value of the surplus that accrues to all four participants?
A)$200
B)$83
C)$159
D)$53

Quizplus · Accepted Answer

The surplus is the difference between the value of the trip to the participants and the price they pay. The value of the trip is given in Table 12-1. The price they pay is $67. The surplus for each participant is:Ken: $150 - $67 = $83Alex: $120 - $67 = $53Brenda: $90 - $67 = $23Rob: $60 - $67 = -$7The total surplus is $83 + $53 + $23 - $7 = $159.

Table 12-1 ​ ​ -Refer to Table 12-1

Table 12-1

-Refer to Table 12-1