The Deadweight Loss (Or Excess Burden) Resulting from Levying a Tax

Multiple Choice

The deadweight loss (or excess burden) resulting from levying a tax on an economic activity is the

A) tax revenue raised by the government as the result of the tax.
B) loss of potential gains from trade from activities forgone because of the tax.
C) increase in the price of an activity as the result of the tax levied on it.
D) marginal benefits derived from the expansion in government activities made possible by the increase in tax revenues.