Why can deadweight loss occur when a price is below the equilibrium even when some consumers benefit from it?

Consumers will purchase more of the good at a price below equilibrium.

Consumers never benefit because a higher price is charged when a shortage occurs.

A surplus occurs at a price below equilibrium allowing consumers to benefit from a lower price.

When a shortage occurs, some consumers are fortunate enough to benefit from a lower price if they purchase the good or service before the price increase occurs.

Question

Business

Monique May

20 July, 13:57

Why can deadweight loss occur when a price is below the equilibrium even when some consumers benefit from it?

Consumers will purchase more of the good at a price below equilibrium.

Consumers never benefit because a higher price is charged when a shortage occurs.

A surplus occurs at a price below equilibrium allowing consumers to benefit from a lower price.

When a shortage occurs, some consumers are fortunate enough to benefit from a lower price if they purchase the good or service before the price increase occurs.

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Answers (1)

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Isiah Werner · Answer 1

When a shortage occurs, some consumers are fortunate enough to benefit from a lower price if they purchase the good or service before the price increase occurs.