Price Ceilings: Deadweight Loss

Title:
Price Ceilings: Deadweight Loss
Description:

In this video, we explore the fourth unintended consequence of price ceilings: deadweight loss. When prices are controlled, the mutually profitable gains from free trade cannot be fully realized, creating deadweight loss. With price controls, less trading occurs and both buyers and sellers miss out on the mutually profitable gains that could have occurred. We’ll show how to calculate deadweight loss using our example of a price ceiling on gasoline.

Microeconomics Course: http://mruniversity.com/courses/principles-economics-microeconomics

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Video Language:
English
Team:
Marginal Revolution University
Project:
Micro
Duration:
03:33
Format: Youtube Primary Original Synced
This video is part of the Marginal Revolution University team.

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