Which of the following leads to a deadweight loss?
i.competition
ii.taxes
iii.consumer surplus
iv.monopoly
A) ii only
B) iii and iv
C) i and ii
D) ii and iv
E) i, ii, and iii

Question

Quizplus · Accepted Answer

Taxes and monopoly both lead to deadweight loss, as they both result in a reduction in consumer surplus and a loss of efficiency in the market. Competition and consumer surplus do not necessarily lead to deadweight loss.

Which of the Following Leads to a Deadweight Loss