PLZ SIMPLY FILL IN THE BLANKS USING INFORMATION PROVIDED THANKS

A very scenic and mountainous town in northern Ontario is considered to be a popular tourist destination for skiing during the winter season.There are many ski resorts in the area, and the rooms are all booked by out-of-town residents.Seasonal demand for rooms by out-of-town residents is perfectly inelastic (vertical) at Q=40 rooms, where Q is the capacity number of rooms.Resort owners are all residents of the town.Their marginal private cost of maintaining the rooms is $20 per room.The local government is considering charging resort owners a hotel room occupancy tax of $5 per room and using the revenues to help finance local public services that are available to local residents only.Using a graph with dollars on the vertical axis and Q on the horizontal axis, answer the following questions.

45. How much revenue will the tax generate for the government? $ ______________

46. What will the deadweight loss from the tax be in market equilibrium? $ _____________

Local residents of this scenic and mountainous town receive marginal benefits from public

services according to MB=100-10Z, where Z is number of units of public services.The town's

marginal cost of providing public services is $20 per unit.The cost is typically financed by

property taxes, but by using hotel room occupancy taxes instead of property taxes, the town

will be able to fully export its taxes to out-of-town residents, effectively reducing it's

marginal private cost of providing public services to zero.

47. What will the deadweight loss be in the market equilibrium with tax exporting? $ ________