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When a good is taxed, there will always be two prices: the price paid by the demanders and the price received by the suppliers. The difference between t How much of a tax gets passed along to consumers depends on the relative steepness of the demand and supply curves. If the supply curve is horizontal, all of the tax gets passed along to consumers; if the suppl... The deadweight loss of a tax is the net loss in consumers’ surplus plus producers’ surplus that arises from imposing the tax. It measures the value of the output that i A situation is Pareto efficient if there is no way to make some group of people better off without making s The Pareto efficient amount of output to supply in a single market is that amount where the demand and supply curves cross, since this is the only point where the amount that demanders are willing to pay for an extra unit of output equals the price a...