When a tax is imposed,the loss of consumer surplus and producer surplus as a result of the tax exceeds the revenue raised by the government.

Name: When a tax is imposed,the loss of consumer surplus and producer surplus as a result of the tax exceeds the revenue raised by the government.
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Question

Quizplus · Accepted Answer

The loss of consumer and producer surplus due to a tax is greater than the tax revenue because of the deadweight loss, which represents the inefficiency created by the tax.

When a Tax Is Imposed,the Loss of Consumer Surplus and Producer