Deadweight loss

[Quantum Windbag]

That is just an example and not what happens when you raise taxes in a wise way.


Say you raised taxes on both wine and beer but only a nickle.


People still buy it and you get more revenue.

 

[Truthmatters]

So you think there is no differeance between the example and reality?


What happens if you tax both the beer and wine only a nickle.

people still buy both.

The tax amount in the example was three dollars to help you unedrstand the point.

Are you really so inept you think it was a suggestion of policy?

 

[syrenn]

Examples





The deadweight loss is the area of the triangle formed by the tax income box, the original supply curve, and the demand curve. This is sometimes called Harberger's triangle.
For example, consider a market for nails where the cost of each nail is 10 cents and the demand will decrease linearly from a high demand for free nails to zero demand for nails at $1.10. In a perfectly competitive market, producers would have to charge a price of 10 cents and every customer whose marginal benefit exceeds 10 cents would have a nail. However if there is one producer who has a monopoly on the product, then they will charge whatever price will yield the greatest profit. For this market, the producer would charge 60 cents and thus exclude every customer who had less than 60 cents of marginal benefit. The deadweight loss is then the economic benefit forgone by these customers due to the monopoly pricing.

Conversely, deadweight loss can also come from consumers buying a product even if it costs more than it benefits them. To describe this, let's use the same nail market, but instead it will be perfectly competitive, with the government giving a 3 cent subsidy to every nail produced. This 3 cent subsidy will push the market price of each nail down to 7 cents. Some consumers then buy nails even though the benefit to them is less than the real cost of 10 cents. This unneeded expense then creates the deadweight loss: resources are not being used efficiently.

If the price of a glass of beer is $3.00 and the price of a glass of wine is $3.00, a consumer might prefer to drink beer. If the government decides to levy a beer tax of $3.00 per glass, the consumer might prefer to drink wine. The excess burden of taxation is the loss of utility to the consumer for drinking wine instead of beer, since everything else remains unchanged. Most notably the tax revenue from this consumer is zero.






Its seems the cons here are affraid of learning things because it will cause their historically failed ideas to be outed for what they really are.

Do you understand that you just proved that taxes and government subsides of any type are bad for the economy?

Explain your thinking.

Can YOU explain YOURS?

Do you think AT ALL???

 

[syrenn]

So you think there is no differeance between the example and reality?


What happens if you tax both the beer and wine only a nickle.

people still buy both.

The tax amount in the example was three dollars to help you unedrstand the point.

Are you really so inept you think it was a suggestion of policy?

Examples and reality

ill give you one

truthmatters..... in reality is should be liesmatter.

 

[Truthmatters]

yet again you proove you have NOTHING of sub stance to offer a discussion

 

[boedicca]

So you think there is no differeance between the example and reality?


What happens if you tax both the beer and wine only a nickle.

people still buy both.

The tax amount in the example was three dollars to help you unedrstand the point.

Are you really so inept you think it was a suggestion of policy?

Riddle me this: at what level do taxes become Too Much and a deterrent to economic participation?

 

[boedicca]

yet again you proove you have NOTHING of sub stance to offer a discussion

As opposed to how you "PROOVE you have NOTHING of sub stance" (sic)?

 

[syrenn]

yet again you proove you have NOTHING of sub stance to offer a discussion

And you do every have anything of substance to discuss? I have no intention of EVER adding anything to your hacking crap..... but to mock you.

 

[Quantum Windbag]

Examples





The deadweight loss is the area of the triangle formed by the tax income box, the original supply curve, and the demand curve. This is sometimes called Harberger's triangle.
For example, consider a market for nails where the cost of each nail is 10 cents and the demand will decrease linearly from a high demand for free nails to zero demand for nails at $1.10. In a perfectly competitive market, producers would have to charge a price of 10 cents and every customer whose marginal benefit exceeds 10 cents would have a nail. However if there is one producer who has a monopoly on the product, then they will charge whatever price will yield the greatest profit. For this market, the producer would charge 60 cents and thus exclude every customer who had less than 60 cents of marginal benefit. The deadweight loss is then the economic benefit forgone by these customers due to the monopoly pricing.

Conversely, deadweight loss can also come from consumers buying a product even if it costs more than it benefits them. To describe this, let's use the same nail market, but instead it will be perfectly competitive, with the government giving a 3 cent subsidy to every nail produced. This 3 cent subsidy will push the market price of each nail down to 7 cents. Some consumers then buy nails even though the benefit to them is less than the real cost of 10 cents. This unneeded expense then creates the deadweight loss: resources are not being used efficiently.

If the price of a glass of beer is $3.00 and the price of a glass of wine is $3.00, a consumer might prefer to drink beer. If the government decides to levy a beer tax of $3.00 per glass, the consumer might prefer to drink wine. The excess burden of taxation is the loss of utility to the consumer for drinking wine instead of beer, since everything else remains unchanged. Most notably the tax revenue from this consumer is zero.






Its seems the cons here are affraid of learning things because it will cause their historically failed ideas to be outed for what they really are.

Do you understand that you just proved that taxes and government subsides of any type are bad for the economy?

Explain your thinking.

Explain my thinking?

Did you read what you posted? Can you read at all?

Conversely, deadweight loss can also come from consumers buying a product even if it costs more than it benefits them. To describe this, let's use the same nail market, but instead it will be perfectly competitive, with the government giving a 3 cent subsidy to every nail produced. This 3 cent subsidy will push the market price of each nail down to 7 cents. Some consumers then buy nails even though the benefit to them is less than the real cost of 10 cents. This unneeded expense then creates the deadweight loss: resources are not being used efficiently.

Subsidies bad.

If the price of a glass of beer is $3.00 and the price of a glass of wine is $3.00, a consumer might prefer to drink beer. If the government decides to levy a beer tax of $3.00 per glass, the consumer might prefer to drink wine. The excess burden of taxation is the loss of utility to the consumer for drinking wine instead of beer, since everything else remains unchanged. Most notably the tax revenue from this consumer is zero.

Taxes bad.

Subsidies and taxes are deadweight on the economy because, all else being equal, they artificially reallocate resources.

Just in case you try to trot out raising taxes on both beer and wine, those taxes would normally be used to buy something of use to the taxpayer. This forces him to choose between the beer or wine and whatever else he would spend the money on.

Do we need to charge taxes? Yes. But they are not good for anyone, which is why they should be kept to a minimum, and we should completely eliminate subsidies, because they just eat up tax dollars that are too high anyway.

 

[syrenn]

QW

Now ask her to explain her thinking..... in her OWN words.

 

[Quantum Windbag]

So you think there is no differeance between the example and reality?


What happens if you tax both the beer and wine only a nickle.

people still buy both.

The tax amount in the example was three dollars to help you unedrstand the point.

Are you really so inept you think it was a suggestion of policy?

Riddle me this: at what level to taxes become Too Much and a deterrent to economic participation?

As the article TM just posted proved, all taxes are a deterrent. We just have to balance that against our actual need for revenue to run the government.

 

[Truthmatters]

Examples





The deadweight loss is the area of the triangle formed by the tax income box, the original supply curve, and the demand curve. This is sometimes called Harberger's triangle.
For example, consider a market for nails where the cost of each nail is 10 cents and the demand will decrease linearly from a high demand for free nails to zero demand for nails at $1.10. In a perfectly competitive market, producers would have to charge a price of 10 cents and every customer whose marginal benefit exceeds 10 cents would have a nail. However if there is one producer who has a monopoly on the product, then they will charge whatever price will yield the greatest profit. For this market, the producer would charge 60 cents and thus exclude every customer who had less than 60 cents of marginal benefit. The deadweight loss is then the economic benefit forgone by these customers due to the monopoly pricing.

Conversely, deadweight loss can also come from consumers buying a product even if it costs more than it benefits them. To describe this, let's use the same nail market, but instead it will be perfectly competitive, with the government giving a 3 cent subsidy to every nail produced. This 3 cent subsidy will push the market price of each nail down to 7 cents. Some consumers then buy nails even though the benefit to them is less than the real cost of 10 cents. This unneeded expense then creates the deadweight loss: resources are not being used efficiently.

If the price of a glass of beer is $3.00 and the price of a glass of wine is $3.00, a consumer might prefer to drink beer. If the government decides to levy a beer tax of $3.00 per glass, the consumer might prefer to drink wine. The excess burden of taxation is the loss of utility to the consumer for drinking wine instead of beer, since everything else remains unchanged. Most notably the tax revenue from this consumer is zero.






Its seems the cons here are affraid of learning things because it will cause their historically failed ideas to be outed for what they really are.

This is an example of the real world effects of policy on our economy.

It is discussion worthy to any intelligent person interested in real discussions on our countrys future.

Tell me how your petty personal insults are of greater value to real discussion?

 

[Quantum Windbag]

QW

Now ask her to explain her thinking..... in her OWN words.

I will settle for her thinking first. Once I accomplish that I will start teaching her to explain herself.

 

[Truthmatters]

So you think there is no differeance between the example and reality?


What happens if you tax both the beer and wine only a nickle.

people still buy both.

The tax amount in the example was three dollars to help you unedrstand the point.

Are you really so inept you think it was a suggestion of policy?

Riddle me this: at what level to taxes become Too Much and a deterrent to economic participation?

As the article TM just posted proved, all taxes are a deterrent. We just have to balance that against our actual need for revenue to run the government.

How do you get that out of this article?

You must not be able to understand the other points in the article.

 

[Truthmatters]

QW

Now ask her to explain her thinking..... in her OWN words.

I will settle for her thinking first. Once I accomplish that I will start teaching her to explain herself.

why dont you explain yourself.

How did this azrticle prove that EVERY tax will have the same effect as a tax large enough to double the cost of a product?

 

[syrenn]

Examples





The deadweight loss is the area of the triangle formed by the tax income box, the original supply curve, and the demand curve. This is sometimes called Harberger's triangle.
For example, consider a market for nails where the cost of each nail is 10 cents and the demand will decrease linearly from a high demand for free nails to zero demand for nails at $1.10. In a perfectly competitive market, producers would have to charge a price of 10 cents and every customer whose marginal benefit exceeds 10 cents would have a nail. However if there is one producer who has a monopoly on the product, then they will charge whatever price will yield the greatest profit. For this market, the producer would charge 60 cents and thus exclude every customer who had less than 60 cents of marginal benefit. The deadweight loss is then the economic benefit forgone by these customers due to the monopoly pricing.

Conversely, deadweight loss can also come from consumers buying a product even if it costs more than it benefits them. To describe this, let's use the same nail market, but instead it will be perfectly competitive, with the government giving a 3 cent subsidy to every nail produced. This 3 cent subsidy will push the market price of each nail down to 7 cents. Some consumers then buy nails even though the benefit to them is less than the real cost of 10 cents. This unneeded expense then creates the deadweight loss: resources are not being used efficiently.

If the price of a glass of beer is $3.00 and the price of a glass of wine is $3.00, a consumer might prefer to drink beer. If the government decides to levy a beer tax of $3.00 per glass, the consumer might prefer to drink wine. The excess burden of taxation is the loss of utility to the consumer for drinking wine instead of beer, since everything else remains unchanged. Most notably the tax revenue from this consumer is zero.






Its seems the cons here are affraid of learning things because it will cause their historically failed ideas to be outed for what they really are.

This is an example of the real world effects of policy on our economy.

It is discussion worthy to any intelligent person interested in real discussions on our countrys future.

Tell me how your petty personal insults are of greater value to real discussion?

You do realize you quoted yourself. And asked yourself a very good question?

"Tell me how your petty personal insults are of greater value to real discussion?"

I agree.... how do your petty personal insults do a damn thing?

 

[Quantum Windbag]

Go back and read the parts I highlighted in a previous post, then feel free to ask any questions you might have.

 

[Quantum Windbag]

QW

Now ask her to explain her thinking..... in her OWN words.

I will settle for her thinking first. Once I accomplish that I will start teaching her to explain herself.

why dont you explain yourself.

How did this azrticle prove that EVERY tax will have the same effect as a tax large enough to double the cost of a product?

I did, in post 129.

 

[syrenn]

QW

Now ask her to explain her thinking..... in her OWN words.

I will settle for her thinking first. Once I accomplish that I will start teaching her to explain herself.

TM...think? A brain that works is needed to think.

 

[WillowTree]

Deadweight loss - Wikipedia, the free encyclopedia



The reality of markets.

please learn something instead of spouting the same failed talking points

You first, dearie.

If you're waiting for her to learn something, I hope you have a couple of meals, and a good book.

She only does talking points.

Talking points from 1986!