What does the deadweight loss of a tax measure? A. the deadweight loss measures

Question

What does the deadweight loss of a tax measure? A.  the deadweight loss measures all of these B.  the lost revenue to businesses because of higher prices to consumers from the tax C.  the loss in a market to buyers and sellers that is not offset by an increase in government revenue D.  the loss in revenue to the government when buyers choose to buy less of the product What does the deadweight loss of a tax measure? A.  the deadweight loss measures all of these B.  the lost revenue to businesses because of higher prices to consumers from the tax C.  the loss in a market to buyers and sellers that is not offset by an increase in government revenue D.  the loss in revenue to the government when buyers choose to buy less of the product

Explanation / Answer

"C"

The loss is a market to buyers and sellers that is not offset by an increase in government revenue. The deadweight loss is a loss to both the consumer, they have to pay a higher price for the goods and the supplier who sell a lesser amount of goods. Both these losses are not covered up by the increase in government revenue.  

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