What is the deadweight loss


Buchanan Industries receives total benefit from polluting according to the formula: π= 10Q-Q^2, where Q= pollution emitted in tons, and profits are measures in dollars. The total damages associated with pollution from this facility are estimated to be D= Q^2 +2Q. (1) What is the deadweight loss associated with Buchanan ignoring the damages that its production causes? (2) Those who live near Buchanan propose that it produce no more than Q=1. What is the deadweight loss associated with this level of production?

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Microeconomics: What is the deadweight loss
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