The Size of a Deadweight Loss in a Market Is

question 212

Multiple Choice

The size of a deadweight loss in a market is reduced by

• A)government legislating a ceiling price.
• B)government legislating a price floor.
• C)market price being close to marginal cost.
• D)creative destruction.

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Definitions:

Higher Level of Unemployment

A state in which there is a larger than usual number of people without jobs, indicating increased job scarcity or economic downturns.

Business Cycle

The fluctuations in economic activity characterized by periods of economic expansion and contraction over time.

Economic Activity

The actions that involve the production, distribution, and consumption of goods and services in an economy.

Unemployment and Inflation

Two key indicators in economics, where unemployment measures the percentage of the workforce that is jobless, and inflation indicates the rate at which the general level of prices for goods and services is rising.