Answer
c. \$20, \$20
Work Step by Step
Upon raising the price to \$80, Bob will not be willing to take the lessons anymore. Thus, Andy loses a surplus of \$20 from this transaction (producer surplus of $60 - 50 = 10$ and consumer surplus of $70 - 60 = 10$), which is the deadweight loss. Only one lesson will be given, in this case to Carl. Therefore, the tax revenue totals \$20.
