Deadweight Loss of Taxation | Part 1| CUET PG Economics Entrance | Indian Economic Services | UPSC|
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- Опубликовано: 30 сен 2024
- In this video, we will see, graphically, how deadweight loss is created because of taxation. Taxes contribute to a deadweight loss by dissuading people from making certain purchases, as the imposed taxes elevate the final product price above the market equilibrium. When taxes on an item increase, both producers and consumers bear the burden, with producers earning less profit and consumers paying higher prices. This leads to reduced consumption, diminishing overall benefits for the consumer market and lowering potential profits for companies.
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