Final answer:
The deadweight loss when producing and selling nine teddy bears reflects the inefficiency in the market due to price controls, which is shown as the sum of areas U and W on the supply and demand diagram.
Step-by-step explanation:
When the market produces and sells nine teddy bears, the deadweight loss is represented by the area on a supply and demand graph that shows the loss in social surplus due to the market operating at an inefficient quantity. The deadweight loss is crucial in understanding how price controls, such as taxes or subsidies, can lead to inefficiencies in the market, preventing some consumers and producers from engaging in transactions they would otherwise find beneficial. It represents the lost welfare or the economic benefit that cannot be recovered and reflects the inefficiency associated with not reaching the equilibrium point where supply equals demand.
In the provided context, the deadweight loss is depicted as the area labeled 'U + W' in a diagram or figure (referred to as Figure 3.24(a) in the reference material). This visualization illustrates how price controls could restrict the natural movement of the market, leading to fewer transactions than what would occur in a free market, hence creating a loss in total surplus for society.