Question 6 (1 point)

Jesse operates an indie movie theatre in Ottawa. He sells 80 tickets per movie screening at the current ticket price and the market is in equilibrium. Jesse wants to open another theater in Toronto, where incomes are 20% higher than in Ottawa. Assuming that the income elasticity of demand for indie movies is 0.8 and that Jesse charges the same admission price in both cities, how many tickets will he be able to sell in his Toronto theater?

Question 6 options:

a	22% more
b	16% more
c	20% more
d	22% less

Question 7 (1 point)

Bill mows lawns for money and he can mow up to 5 lawns in a day. The following table shows Bill's total benefit and total cost of mowing lawns. What is Bill's optimal number of lawns mowed in a day?

Quantity on Lawns Mowed	Total Cost	Total Benefit
0	$0	$0
1	$12	$15
2	$22	$30
3	$32	$45
4	$45	$60
5	$59	$75

Question 7 options:

a	2
b	4
c	3
d	5

Question 8 (1 point)

A baker supplies 200 cupcakes when the price of cupcakes is $4.50, but supplies 280 when the price rises to $7.50. Using the

midpoint formula, her elasticity of supply is equal to:

Question 8 options:

a	2/3
b	1/3
c	1
d	1/2

Question 9 (1 point)

Which of the following objectives can be achieved my imposing an excise tax?

Question 9 options:

a	Increasing consumer surplus
b	Increasing producer surplus
c	Decreasing the quantity transacted
d	Increasing total surplus

Question 10 (1 point)

You run a business with annual revenue of $5,000 and expenses of $1,400. You have a job offer from one of your competitors to work for an annual salary of $2500. The equipment for the business could be sold and the funds invested to generate $100 in annual interest earnings if the proceeds were invested.

What is your economic profit from running the business?

Question 10 options:

a	$1,000
b	$1,700
c	$1,400
d	$2,100