The Dead-Weight Loss from an Excise Tax

question 15

Multiple Choice

The dead-weight loss from an excise tax

• A)is greater if demand is perfectly inelastic.
• B)is caused by a shift in consumer preferences when the tax is raised.
• C)is the lost surplus that results from higher prices and lower output resulting from the tax.
• D)is of little concern to policy makers since all excise taxes are "sin" taxes.
• E)is the difference between consumer surplus and producer surplus.

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Definitions:

Population

The total number of individuals inhabiting a particular territory or area, often analyzed in terms of density, distribution, and growth rates.

Individuals

Single organisms of a particular species, considered separately from their population or community.

Species

A group of organisms sharing common characteristics and genetic makeup, capable of interbreeding and producing fertile offspring under natural conditions.

Basic Unit

The fundamental component or element from which a system is built or organized.