Question 1: Economic inefficiency means: A. a good cannot be profitably produced B. a dead weight loss is created C. producer surplus is greater than consumer surplus D. Consumer surplus is greater than producer surplus Question 2: An externality: A. occurs because the government tries to regulate it B. equals 1 when supply equals demand C. only affects manufacturing companies D. is a cost or benefit that affects someone other than the seller or the buyer of a good Question 3: Assume that the demand for a good is relatively more elastic than its supply. The actual burden of a tax, imposed on this good will be on: A. buyers B. sellers C. both buyers and sellers, but buyers pay more D. both buyers and sellers, but sellers pay more