Economics 2151A/B Midterm: chapter_5_long-1

Deadweight loss results from

A. Equilibrium

B. Underproduction.

C. Overproduction.

D. none of the above

E. either b or c.

42) A production quota A) is efficient because it results in underproduction. B) is inefficient because it results in underproduction. C) is inefficient because it results in overproduction. D) is efficient for quantities below the equilibrium quantity and is inefficient for quantities above the equilibrium quantity. E) is efficient because it results in overproduction.

An efficiency loss (or deadweight loss):

A. Is measured as the combined loss of consumer surplus and producer surplus from over- or underproducing.

B. Results from producing a unit of output for which the maximum willingness to pay exceeds the minimum acceptable price

C. Can result from underproduction, but not from overproduction.

D. Can result from overproduction, but not from underproduction.