Arrange the following steps in the process of how government intervention affects market efficiency and output levels: A) Government imposes a tax on a good B) Producers reduce output due to higher costs C) Market price increases, leading to reduced consumer demand D) Allocative efficiency is disrupted, causing deadweight loss.

When the government imposes a tax on a good, it increases the costs for producers. As a result, producers tend to reduce their output because they are now making less profit on each item sold. This reduction in supply causes the market price to rise, which can lead to fewer consumers wanting to buy the product. Consequently, this disruption in the market affects allocative efficiency, meaning that resources are not being used in the best way possible, leading to deadweight loss. For example, if a tax is placed on soda, producers might make less soda, prices go up, and fewer people may buy it, which is less efficient for the economy.