The dead-weight loss of a tariff equals the sum of the net changes in consumer and producer surplus.

Name: The dead-weight loss of a tariff equals the sum of the net changes in consumer and producer surplus.
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Question

Quizplus · Accepted Answer

The dead-weight loss of a tariff also includes the efficiency losses in the market, not just the sum of the net changes in consumer and producer surplus. It specifically refers to the reduction in economic efficiency that occurs due to the distortion of the market equilibrium.

The Dead-Weight Loss of a Tariff Equals the Sum of the Net