Economists use the term deadweight loss because
A)it measures a decrease in agricultural production.
B)the lost producer and consumer surpluses are transferred to the government.
C)it measures the loss of profit, the lifeblood of a market economy.
D)the lost portions of producer and consumer surpluses are completely lost and accrue to no one.
E)the losses in producer and consumer surpluses are too large to estimate.

Question

Quizplus · Accepted Answer

Deadweight loss refers to the loss of surplus that occurs when the equilibrium quantity of a good is not produced, resulting in a net loss to society. This lost surplus is not transferred to anyone, hence it is completely lost, without any gains to society.

Economists Use the Term Deadweight Loss Because