1 when the demand line is perfectly elastic there is no

Assignment Help Macroeconomics

1. When the demand line is perfectly elastic, there is no deadweight loss after taxation.

2. Firms must not operate if the market price is less than ‘break-even' price.

3. Price floor would lead to surplus in the market.

4. When the supply line is perfectly inelastic, there is no deadweight loss after subsidy.

5. A positive externality for individual X can not be a negative externality for individual Y.

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