Chapter 5

Deadwight loss occurs when supply and demand are out of equilibrium.

The height of the supply curve at any quantity can be thought of as the

The greater burden of a tax falls on consumers if demand is relatively more inelastic.

Deadweight loss can be thought of as surplus that is transferred from producers or consumers and given to

If the government wants to create tax revenues without generating deadweight loss, what type of good should they tax?

The incidence of the tax is determined by who pays the tax out of pocket.

The difference between the price the good was sold at and the minimum price the firm would have accepted for the good is

The height of the demand curve at any quantity can be thought of as the

A deadweight loss is a cost to society created by market inefficiency.

The incidence of the tax depends on the relative elasticities of supply and demand.