Deadweight loss rev: 05_10_2018 Multiple Choice
is measured as the combined loss of consumer surplus and producer surplus.
results from producing a unit of output for which the maximum willingness to pay exceeds the minimum acceptable price.
can result from underproduction, but not from overproduction.
can result from overproduction, but not from underproduction.

is measured as the combined loss of consumer surplus and producer surplus.

Explanation:

A deadweight loss happens when the equilibrium quantity is not reached, resulting in a loss of economic surplus (addition of supplier and consumer surplus).

For example, a price ceiling increases the quantity demanded but decreases the quantity supplied, resulting in a shortage. The deadweight loss is measured by the area beneath the demand curve and above the supply curve.

The deadweight loss can also result from a price floor, where the quantity demanded decrease and the quantity supplied increases.