Deadweight loss measures the inefficiency as the loss of
A) consumer surplus only.
B) consumer surplus minus producer surplus.
C) consumer surplus plus producer surplus.
D) producer surplus only.
C
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In the foreign exchange market, a decrease in the exchange rate increases the quantity of dollars supplied
Indicate whether the statement is true or false
The term ceteris paribus means that
a. everything is changing. b. all variables except those specified are constant. c. no one knows which variables will change and which will remain constant. d. the basic postulate of economics does not apply for the case being considered.
An increase in the demand for bonds
A) raises the interest rate and increases equilibrium quantity of bonds. B) raises the interest rate and decreases equilibrium quantity of bonds. C) lowers the interest rate and decreases equilibrium quantity of bonds. D) lowers the interest rate and increases equilibrium quantity of bonds.
A decrease in demand and a decrease in supply will lead to
A) unambiguous increases in both price and quantity. B) unambiguous decreases in both price quantity. C) an unambiguous decrease in price, but the effect on quantity is indeterminate. D) an unambiguous decrease in quantity, but the effect on price is indeterminate.