What shape is used to calculate deadweight loss?

The shape used to calculate deadweight loss in economics is a triangle. Deadweight loss refers to the loss of economic efficiency that occurs when equilibrium for a good or service is not achieved. Specifically, it arises when supply and demand are not perfectly balanced due to factors such as taxes, subsidies, or price controls.

When analyzing the market, deadweight loss is visually represented as a triangle on a supply and demand graph. This triangle is formed between the supply and demand curves and the quantity produced under the market distortion, such as a tax. The area of this triangle represents the total loss in consumer and producer surplus that results from the distortion, indicating resources are not being allocated efficiently.

Thus, the triangular shape captures the concept of reduced economic welfare resulting from the market intervention, which differentiates it from other geometric shapes that do not appropriately represent the dynamics of changes in surplus related to supply and demand shifts.