When the government imposes an excise tax,the deadweight loss is caused by:

A) equal the tax revenue paid to the government.
B) be greater than the tax revenue paid to the government.
C) be less than the tax revenue paid to the government.
D) prevention of transactions because of the cost of the tax.

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Ghiwa Amhaz · Accepted Answer

Final Answer : D, Explanation :  The deadweight loss from an excise tax arises because the tax increases the price buyers pay and decreases the price sellers receive, leading to fewer transactions in the market. This reduction in the number of transactions results in a loss of economic efficiency, as some mutually beneficial trades do not occur.

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When the government imposes an excise tax,the deadweight loss is caused by:A) equal the tax revenue paid to the government.B) be greater than the tax revenue paid to the government.C) be less than the tax revenue paid to the government.D) prevention of transactions because of the cost of the tax.

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