If the government tripled the taxes on new cameras, the deadweight loss from the camera tax would:
A)more than triple
B)triple
C)increase by less than triple
D)be unchanged

Question

Quizplus · Accepted Answer

When taxes are increased, the deadweight loss increases as well. However, the increase in deadweight loss is not directly proportional to the increase in taxes. In this case, tripling the taxes on new cameras would likely result in a more than triple increase in deadweight loss, as consumers may choose to forgo purchasing cameras altogether, leading to a larger loss in consumer surplus and producer surplus.

If the Government Tripled the Taxes on New Cameras, the Deadweight