At a price above the perfectly competitive equilibrium, society will suffer a deadweight loss.

Question

Quizplus · Accepted Answer

A deadweight loss occurs when there is a market inefficiency, such as a price above the perfectly competitive equilibrium. This results in a loss of welfare for society as some potential gains from transactions are not realized. Therefore, society will suffer a deadweight loss when the price is above the perfectly competitive equilibrium.

At a Price Above the Perfectly Competitive Equilibrium, Society Will