Use the following to answer question:
-(Figure: The Market for Blue Jeans)Use Figure: The Market for Blue Jeans.The government recently levied a $10 tax on the producers of blue jeans.What area or areas in the graph identify deadweight loss?

Question

Use the following to answer question: 
-(Figure: The Market for Blue Jeans)Use Figure: The Market for Blue Jeans.The government recently levied a $10 tax on the producers of blue jeans.What area or areas in the graph identify deadweight loss?

Quizplus · Accepted Answer

Deadweight loss is the loss of economic efficiency when the equilibrium outcome is not achievable or not achieved. In the context of a tax, it is represented by the area of the triangle formed between the supply and demand curves, which is area c + e in this case.

Use the Following to Answer Question