If the market price is at equilibrium, the deadweight loss is maximised.

Name: If the market price is at equilibrium, the deadweight loss is maximised.
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Question

Quizplus · Accepted Answer

If the market price is at equilibrium, there is no deadweight loss as quantity supplied equals quantity demanded. Deadweight loss exists only when there is market inefficiency, such as the imposition of a price floor or ceiling. When the market is at equilibrium, there is no such inefficiency and hence no deadweight loss.

If the Market Price Is at Equilibrium, the Deadweight Loss