Concept
Version 6
Created by Boundless
Understanding and Finding the Deadweight Loss
Deadweight loss
This graph shows the deadweight loss that is the result of a binding price ceiling. Policy makers will place a binding price ceiling when they believe that the benefit from the transfer of surplus outweighs the adverse impact of the deadweight loss.
Source
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"Deadweight-loss-price-ceiling."
http://en.wikipedia.org/wiki/File:Deadweight-loss-price-ceiling.svg
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