The two factors that determine how large the deadweight loss will be due to a tax being imposed on a market are how big the tax is and how elastic supply and demand are. As the amount of the tax increases, more people stop buying the product. This decrease in the quantity sold (the loss in mutually beneficial trades) [ Select ] the deadweight loss (DWL). Also, the more sensitive people are to the higher price (the more elastic demand is), the more people will stop buying the product. This decrease in the quantity sold (the loss in mutually beneficial trades) [ Select ] the deadweight loss (DWL)