Refer to Figure 8-9. Suppose the government places a $4 tax per unit on this good. How much is the deadweight loss from this tax?

Deadweight Loss

The economic efficiency is lessened when a good or service does not attain its equilibrium in the free market.

Tax

Compulsory financial charges imposed by a government on individuals and organizations to fund public expenditures.

Good

An item or product that satisfies a want or need, available for sale or trade.